Congratulations to the Newly Constituted Board of the CCI – Eastern Ontario Chapter

As many of our readers know, last night was the Annual General Meeting for the Canadian Condominium Institute – Eastern Ontario Chapter. We are pleased that Nancy Houle, partner with our firm, will have the opportunity to continue to service the condominium community as a member of the Board of the Canadian Condominium Institute – Eastern Ontario Chapter. 

With so many changes to the legislation governing condominiums happening in the coming months, the Canadian Condominium Institute is an instrumental player in engaging and educating the eastern Ontario condominium community. Congratulations to the newly constituted Board!

What Happens If Your Condominium Corporation Does Not Register With the CAO?

At the CCI-EO Annual General Meeting last night, the following question was asked: What happens if a condominium doesn’t register with the Condominium Authority of Ontario?  We realized this morning that the question was not answered, so we wanted to post a quick blog to answer the question.

As you know, the changes to the Condominium Act, 1998 have created the Condominium Authority of Ontario (“CAO”).  All condominium corporations in Ontario must register with the CAO and pay assessments by December 31, 2017. [Note: Check out our previous blogs for more information about the requirement to register and the proposed fees.  Also, please refer to the CAO website for additional information.]

If your condominium corporation does not register or registers, but does not pay its fees, there are two main consequences:

• The Registrar may make a compliance order against the condominium corporation [Notice of this Order must be given to Owners]; and

• The condominium corporation will not be capable of maintaining a proceeding before the Condominium Authority Tribunal or a proceeding in a court in Ontario except with leave of the Court.

These consequences are severe and can have a wide range of implications for condominium corporations.  For example:

• It could affect an insurer’s right to assert a subrogated claim;

• It can affect the marketability of the condominium corporation; and

• It can affect the condominium corporation’s ability to manage the affairs of the corporation.

In addition to the foregoing, condominium corporations must make additional filings with the Registrar including various returns.  If the condominium corporation is not registered, and thereby does not file its returns, it can be subject to late fees.

In our view, it makes the most practical sense to ensure you register.

In order to register, your condominium corporation needs a unique code.  If your condominium has not yet received a unique invitation code, contact the CAO at info@condoauthorityontario.ca.

Stay tuned to Condo Law News for more blogs about amendments to the Condominium Act and upcoming events .

Are There Any Exceptions to the Requirements in the New Condominium Act?

As many of our readers know, the new Condominium Act (the “Act”) amendments that are soon to be in effect will create new requirements and obligations for condominiums and their Boards. What our readers may not know is that the amendments also contain some exceptions to these new requirements and obligations.

In this blog, we provide an overview of a few of these exceptions.

  • Notices to be filed with the Condominium Authority

As outlined in an earlier blog, condominium corporations will be obligated to file certain “Returns” and notices with the Condominium Authority, and will in particular be required to notify the Authority of any changes to the membership of the Board.  However, a condominium corporation will not be required to file a notice of change where a director is re-elected immediately following a preceding term of office (see section 9.3(2) of the Condominium Act for this exception).

  • Information Certificates

Condominium corporations will be required to send out certain information certificates (including periodic information certificates, and new owner information certificate).  However, where certain conditions are met, including where 80% of owners have consented in writing to dispensing with the requirement to send such certificates, the condominium corporation may be exempt from this requirement (see section 60(5) of the Condominium Act for this exception).

  • Matters to be adjudicated by the Condominium Authority Tribunal

The Condominium Authority Tribunal will adjudicate most matters that it is requested to consider, except disputes involving:

  • Title to any real property (units or common areas)
  • Easements
  • Occupier’s liability
  • Condominium liens
  • Prohibited activities described in s. 117 of the act., or
  • The constitutionality of any provisions of the Act or Regulations (see generally sections 1.35 – 1.42 of the Condominium Act for these exceptions).

Davidson Houle Allen LLP would like to thank our Articling Student, David Lu, for his contribution in preparing this Blog.

Stay tuned to Condo Law News for other blogs about the amendments to the Condominium Act, and upcoming events.

Update on the Discipline Process under the CMSA

One of the more unsettling changes for condominium managers coming under the Condominium Management Services Act (“CMSA”) is obviously the complaint and discipline procedures. As we previously reported, under the CMSA anyone will be able to make a complaint to the Registrar of the Condominium Management Regulatory Authority (“CMRAO”) against a condominium manager for an alleged failure to comply with the proposed Code of Ethics. Sections 57 and 58 of the CMSA establish the following three levels of authority to deal with any such complaints:

1) CMRAO Registrar;

2) Discipline Committee; and

3) Appeals Committee.

Since the CMSA came out, we’ve known that under section 57 all complaints will go directly to the Registrar initially, who has very broad powers to deal with the complaint. Notably, if the Registrar is not able to resolve the complaint, the Registrar has the authority to refer the matter to the discipline committee.

Now that we have the proposed additional regulations under the CMSA, we have a much better understanding of the procedures for the discipline and appeals committees. If passed, here’s what the proposed regulations tell us about both the discipline committee and the appeals committee:

Composition and Appointments to the Discipline Committee and Appeal Committee

Composition: The CMRAO Board (or the Minister, if necessary) will appoint at least five members each to sit on the discipline committee and the appeals committee, at least one of whom has never been a licensee (i.e. a condominium manager).

Appointments: A person can sit on both the discipline and appeals committee at the same time. Each committee with have a chair appointed (and possibly vice-chairs). Once appointed, each committee member will be required to take, and sign, an oath. Appointments will be for three-year terms. However, the CMRAO Board can terminate the appointment of a committee member at any time for cause.

Procedures for the Discipline Committee

In our view, the discipline committee will be the second level of authority in the complaint process (the Registrar is essentially the first level of authority).

Limitation: The CMRAO Registrar must refer a complaint to the discipline committee within two years of receiving the compliant.

Purpose: The committee’s purpose is to hold a “semi court-like” hearing, that is open to the public, to review the complaint. In other words, the committee will likely follow a typical court hearing process, but may allow relaxed rules respecting evidence and testimony from witnesses. When a complaint is referred to the discipline committee, the chair will assign a three member panel (made up of two licensees and a non-licensee) to hear and determine the matter.

Parties: The CMRAO (and not the person who initially brought the complaint) appears to be the moving party, and the condominium manager (that is the subject of the complaint) would obviously be the responding party. The committee has the authority to add any other party to the proceeding, if necessary. Parties may represent themselves at the hearing or appoint legal counsel on their behalf.

Notice: Once a hearing date has been set to review the complaint, the committee must give the parties at least 45 days notice of the hearing date.

Evidence: If the CMRAO plans to tender evidence at the hearing, it must disclose the evidence to the parties 30 days before the hearing. Any other party (including the condominium manager), must disclose any evidence they plan to tender 15 days before the hearing.

Closed Hearing: If necessary, the committee can order that the evidence and submissions at the hearing be closed to the public.

Notice of Committee’s Decision: Once a decision has been made, the committee must send the final decision or order (including a notice of appeal rights) to the parties and to the person that made the complaint (even though the complainant may not be a party to the hearing).

Unless otherwise ordered, the decision must also be made public.

Procedures for the Appeals Committee

Again, in our view, the appeals committee will be the third level of authority in the complaint process, after the Registrar and the discipline committee.

Purpose: The purpose of the appeals committee is, obviously, to hear appeals from a decision of the discipline committee. The appeals committee will follow essentially the same process as the discipline committee with respect to disclosure of evidence and notice of a decision.

Limitation: If warranted, a party must appeal a decision from the discipline committee within 30 days of the discipline committee’s order.

Commencement of Appeal: To start the appeal process, the appellant must deliver to the appeals committee: 1) a Notice of Appeal (that sets out the parties to the appeal, the order being appealed, the grounds for the appeal, and the relief sought); and 2) the required filing fee (set by the CMRAO).

The appellant must also serve a copy of the Notice of Appeal to the discipline committee and the other parties to the appeal.

Parties: The parties to the appeal are, of course, the appellant, the other parties to the proceeding before the discipline committee, and any other person as added by the appeals committee.

Summary

The bottom line is that while the complaints and discipline procedures may appear intimidating or cumbersome, the process seems to be structured to permit the Registrar to handle (and dismiss or resolve) the majority of complaints that come in.  It appears structured such that only truly serious complaints, with due merit, will proceed past this first step.

Stay tuned to Condo Law News for more updates on the new legislation as it comes into force.

Tarion – Important Changes are Underway

On October 5, 2017, Ontario’s Minister of Government and Consumer Services (the Honourable Tracy McCharles) introduced the Strengthening Protection for Ontario Consumers Act, 2017.

If passed, this new legislation would bring dramatic changes to the new home warranty process in Ontario, following on the heels of Justice Douglas Cunningham’s comprehensive review of Tarion (the non-profit corporation that currently oversees new home warranties in Ontario).

The notice from the Ministry includes the following:

“The legislation (the Strengthening Protection for Ontario Consumers Act, 2017), if passed, would help strengthen consumer confidence in Ontario’s new home warranty program, promote properly built residential construction, and further enhance consumer protection. Proposed changes would: 

• Provide for two administrative authorities – one to administer the new home warranty program and one to regulate new home builders and vendors;

• Make the dispute resolution process easier for homeowners if they discover a problem in the construction of their new home;

• Strengthen the regulation of new home builders and vendors;

• Give government power to make rules and set standards; and

• Introduce modern oversight measures to improve accountability and transparency.

Should the bill pass, the ministry plans to consult with the public and other stakeholders during the regulation development phase on proposed regulations that would give effect to these legislative changes.”

We wholeheartedly support these proposed changes, which should greatly improve the warranty process for new home owners in Ontario. See our previous blogs respecting Justice Cunningham’s Review. And stay tuned for our further blogs on this topic, as we receive the draft new Regulations.

The Complaint Process under the CMSA

As we previously reported, section 57 of the Condominium Management Services Act (“CMSA”) establishes a complaint process under the new licensing regime. And now, the proposed regulations under the CMSA (circulated by the Ministry on August 30, 2017) provide further insight into the complaint process.

Here’s what we already knew about the complaint process under section 57 of the CMSA:

– Anyone can bring a complaint against a condominium manager, as long as the complaint is made to the Registrar appointed under the CMSA;

– Based on our interpretation, a complaint can be made against a condominium manager for:

– Any alleged violation of a condominium manager’s obligations under the CMSA; or

– Any alleged violation of the Code of Ethics.

– Once a complaint is received, the Registrar has the authority to investigate the complaint and can request information from any

– Licensees must respond to the Registrar’s request for information as soon as practicable.

– In responding to a complaint, the Registrar can choose from several options, including resolving the complaint themselves or referring the complaint to the discipline committee.

Now, with the proposed regulations under the CMSA, we have further insight into how the Registrar will investigate complaints, and the obligations that condominium managers will likely have in relation to such complaints. Here is what the proposed regulations appear to be telling us:

– The Registrar must give notice to specific individuals when making a request for information to investigate a complaint. Specifically, the Registrar must give notice as follows:

– If the request for information is made to a condominium management provider, the Registrar will send notice to the principal condominium manager of that firm; or

–  If the request for information is made to a condominium manager, the Registrar will also give notice to the principal condominium manager that employs the manager.

– If the Registrar takes any action against a licensee in response to a complaint, the Registrar will give notice of such action to:

– The licensee’s principal condominium manager, if the licensee is a condominium management provider;

– The licensee’s principal condominium manager and the licensee, if the licensee is employed by a condominium management provider; and

– The licensee and the condominium’s board of directors, if the licensee is a condominium manager employed directly by a condominium corporation.

– Further, a licensee cannot obstruct or interfere with any of the following:

– Someone making a complaint to the Registrar about a licensee;

– Providing information requested by the Registrar relating to the conduct of a licensee or a potential contravention of the CMSA or the CMSA’s regulations.

The intent of the regulations seems to be that if the Registrar requests information to investigate a complaint about a condominium manager, or the Registrar takes action against a condominium manager respecting a complaint, both the condominium manager and their employer (if applicable) will receive notice from Registrar.

Stay tuned to Condo Law News for more in our series of blogs coming shortly to give more details and comments about these proposed regulations. Next up will be our review of the discipline process.

Ian Darling is the Newly Appointed Chair to the Condominium Authority Tribunal

We are pleased to report that Ian Darling has been appointed as the Chair of the Condominium Authority Tribunal (“CAT”) effective October 2, 2017. Mr. Darling was appointed by the Board of Directors of the newly established Condominium Authority of Ontario.

As part of his duties, Mr. Darling will recruit and lead a team of mediators and adjudicators who will oversee the CAT. Part of Mr. Darling’s mandate is to foster a consumer-focused culture that aims to resolve disputes in a respectful, timely, and cost-effective manner.

Mr. Darling has a strong background in dispute resolution that he brings to his new role. Previously, Mr. Darling was the Ombudsman for Tarion and Fanshawe College. He also served on the Board of Directors for the Forum of Canadian Ombudsman from 2003 – 2013. Mr. Darling’s educational background includes an honours Bachelor Degree in History from McMaster University, and a Master of Arts Degree in Conflict Resolution from Antioch University.

Stay tuned to Condo Law News for more updates on the Condominium Authority Tribunal.

Proposed Code of Ethics for Condominium Managers has been released

As many of our readers know, we now have proposed additional regulations under the Condominium Management Services Act (“CMSA”). Notably, the proposed regulations include the Code of Ethics that condominium managers will be required to adhere to. The Ministry is requesting feedback on the proposed regulations (up until October 16, 2017).

As our regular readers know, the Condominium Management Services Act (“CMSA”) says that condominium managers must comply with a Code of Ethics or they risk facing complaints and discipline. However, we haven’t yet known with any certainly what the Code of Ethics would require…until now.

On August 30, 2017, the Ministry circulated proposed regulations that provide direction on the CMSA’s requirements. Perhaps one of the most serious sections of the proposed regulations is the new Code of Ethics. It outlines numerous proposed obligations for condominium managers and is designed to promote professionalism, reliability, and quality of services.

The Code of Ethics uses plain language, which makes it easy to understand and is broken down into two sections:

  • General Obligations: and
  • Protecting Client Interests.

As the proposed regulations are currently drafted, the General Obligations of the Code of Ethics confirm that condominium managers have an obligation to:

–  Not act in a way that causes the condominium management provider to contravene the Code of Ethics.

–  Treat everyone fairly, honestly, and with integrity.

–  Not discriminate, harass, or commit acts of violence.

–  Provide reasonable accommodation to persons with disabilities.

–  Provide courteous, conscientious, and responsive service.

–  Demonstrate reasonable knowledge, skill, judgement, and competence when providing opinions or advice.

–  Keep all records required in providing management services.

–  Be financially responsible in providing condominium management services.

–  Not misrepresent the conditions of their licence.

–  Use best efforts to prevent error, misrepresentation, fraud, or unethical practice.

–  Not engage in an act or omission that could be seen as disgraceful, dishonourable, unprofessional, or unbecoming.

–  Not unreasonably interfere with the use and enjoyment of the common elements, units, or assets by an owner, resident, or the condominium corporation itself, unless required to do so by law.

These General Obligations are owed to the public at large – including owners and occupants.

Under the Protecting Client Interests section of the Code of Ethics, condominium managers must:

–  Keep the client informed of all significant steps the manager takes.

–  Promote and protect the best interest of the condominium.

–  Be diligent in executing their contractual obligation to manage, maintain, repair, or protect the property or assets of condominium.

–  Advise a client to obtain services from another person where those services are beyond the condominium manager’s knowledge (or they’re not authorized to provide those services).

–  Not indicate, either directly or indirectly, that remuneration or other costs are fixed by the Administrative Authority or a government body.

–  Not disclose any confidential information to a third party without prior written consent.

These obligations are owed to clients – i.e. the condominium corporation clients.

As it currently reads, the Code of Ethics contains a number of requirements that most regulated professionals (such as lawyers or doctors) must also meet. For example, the requirements for confidentiality or reasonable knowledge are required of most professionals and are fairly easy to monitor.

With that said, some of the other proposed requirements seem to be less common in professional standards, and may ultimately be difficult to judge. For example, how will managers be judged on their obligation to provide “conscientious” service? How are managers to judge whether their conduct is “disgraceful” or “unbecoming”?

While I think the sentiment is clear: The Ministry expects a high standard of professionalism and courtesy from condominium managers, some of the proposed requirements might be too subjective or uncertain as they currently read. We’ll have to wait to see if the Ministry clarifies or omits some of the more subjective or confusing requirements before the Code of Ethics is finalized. This will be particularly important given that a breach of the Code of Ethics could result in discipline process for the manager.

Stay tuned to Condo Law News for a series of blogs coming shortly to give more details and comments about these proposed regulations. Next up will be our review of the complaints process.

New Proposed Regulations under the CMSA

The Ministry has circulated proposed regulations under the Condominium Management Services Act (“CMSA”) that give us further insight into the standards condominium managers will have to meet once the CMSA comes into force. For now the Ministry is seeking feedback on the proposed regulations from the public. Condominium owners, residents, developers, managers and other stakeholders are invited to submit their comments.

We’re another step closer to better understanding the rest of the Condominium Management Services Act (“CMSA”) – beyond the pure licensing requirements.

On August 30, 2017, the Ministry circulated proposed regulations that provide direction on the following sections of the CMSA:

The proposed regulations are designed to serve as a directive to “spell out” in more detail the requirements of the CMSA. In June 2017, the Ministry previously filed a General Regulation (Regulation 123/17) that deals with other sections of the CMSA such as licence applications and licensee requirements. Once passed, the newly proposed regulations will work alongside Regulation 123/17.

The Ministry expects that the proposed regulations will be finalized and come into force on February 1, 2018.

In the meantime, the Ministry is now seeking public feedback until October 16, 2017, that will be considered when finalizing the regulations. You can provide your comments by mail to: 56 Wellesley Street West, 6th Floor, Toronto, Ontario, M7A 1C1. Be sure to quote “Proposal Number 17-MGCS018.”

While the proposed regulations have yet to be finalized and are subject to change, they provide valuable insight into the standards and obligations the Ministry expects of condominium managers.

Here’s a general overview of the proposed regulations:

Code of Ethics

Perhaps the most serious aspect of the proposed regulations is the new Code of Ethics for condominium managers. The CMSA allows for the establishment of a Code of Ethics for licensees, and the proposed regulations set out the proposed Code of Ethics.  The Code of Ethics will set the standards that licensees must meet to comply with their ethical obligations under the CMSA. According to the proposed Regulations, the Code of Ethics is designed to promote professionalism, reliability, and quality of services.

Discipline and Appeals Committee

The CMSA also establishes two committees – the Discipline Committee and the Appeals Committee – which are designed to hear and determine complaints about alleged breaches of professionalism (including alleged violations of the Code of Ethics). We now know that the committees will each consist of 5 members appointed by the Board of the Condominium Management Regulatory Authority of Ontario (CMRAO). The proposed regulations explain the composition of the committees and the procedures they must follow.

Complaints

Under the CMSA, if the Registrar receives a complaint about a licensee, the regulation sets out the procedures respecting complaints. Among other things, the Registrar can request information related to the complaint from any licensee. The proposed regulations set out the notice required to do so and set out a licensee’s obligations when a complaint is made.

Insurance

The proposed regulations say that every licensed condominium management provider must maintain both errors and omissions insurance and fidelity insurance. The proposed regulations also set out the obligations for condominium management providers to disclose information about the types and amounts of insurance coverage they carry.

Other Requirements

The proposed regulations also establish requirements respecting the following:

  • Disclosure required by Licensees: licensees will be required to disclose certain information in writing to prospective clients before entering into a contract for management services.
  • Duties in relation to client records: the proposed regulations will require licensees who hold records on behalf of clients to comply with certain standards.
  • Duties in relation to supervision of licensees: The proposed regulation would require licensed condominium management providers to ensure an adequate level of supervision for limited licensees in their employment.

Stay tuned to Condo Law News for a series of blogs coming shortly to give more details and comments about these proposed regulations. First up will be our review of the Code of Ethics.

 

 

Condominiums must register with the CAO (Condominium Authority of Ontario) and pay Assessments by December 31, 2017

Condominiums have started to receive Welcome notices from the CAO.

These Welcome notices outline some important features of the CAO, many of which we have discussed in past blogs, including:

  • Information and resources available through the CAO
  • Dispute Resolution through the Tribunal starting November 1, 2017
  • upcoming Online Mandatory Director Training (which will also be accessible to the public and owners at no charge)
  • Information about the pending public registry of Condominiums

The CAO website now has some comprehensive information as well.

Condominium corporations are reminded to:

  • Register the condominium with the CAO online,  (once you have received a unique invitation code) which will require the following information:

– The type of condominium corporation being registered
– The service address for the condominium corporation
– The number of units and voting units
– The names, email addresses, and terms for condo directors (optional)
– The name, email address and firm (if applicable) for your condo manager (optional)

    • Pay the condominium corporation’s assessment by December 31, 2017

More information is available here on the Registration page of the CAO website.

Stay tuned to Condo Law News for more blogs about amendments to the Condominium Act and upcoming events .