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 Corporation Too Slow in Attempting to Resolve Noise Problem

In the recent Court decision Wu v. Peel Condominium Corporation No. 245, a condominium corporation was found liable for oppression, on the grounds that it had failed to act with sufficient haste to address an owner’s complaints about noise from the elevators.

Ms. Wu bought a one-bedroom unit on the top floor of a 24-floor building in Toronto in 2008. The unit was adjacent to the building’s mechanical, elevator and HVAC equipment, which serviced the entire building. Approximately 6 months after she moved in, Ms. Wu first experienced noise and vibrations in her unit. She claimed that the noise sounded like a motorcycle or helicopter. Ms. Wu’s complaints to the condominium’s manager were many, varied and continuous from 2008 to 2014. The manager and the condominium board both agreed that the noise/vibration problem existed, although not as dramatically as Ms. Wu stated.

Beginning in 2009, the condominium hired consultants to investigate and recommend methods to resolve the problem. Some attempts were made to resolve the noise and vibration, but to no avail. In 2012, the condominium advised Ms. Wu that the condominium had “done as much as it could do” to solve the problem.

In 2013, Ms. Wu retained legal counsel and, following mediation, the condominium agreed to fix the problem. Although the condominium retained further consultants, the corporation failed to carry out any of the suggested actions to resolve the issue.

In 2014, Ms. Wu then commenced an action against the condominium for oppression and damages. She was successful. The Court held that while the condominium had attempted to address the noise and vibration problem from 2009 to 2011, it then stopped and took no further positive steps until shortly before the Court hearing. During this entire period, the problem continued. The Court held that this was oppressive to Ms. Wu.

The Court ordered that the condominium corporation continue to try to fix the problem using the recommendations provided by its consultants in 2014, prior to the Court hearing. The Court ordered that the condominium must appear before the same judge within 45 days to advise what could be done to attempt to resolve the problem. The Court also ordered that the corporation pay to Ms. Wu $30,000 in damages due to its oppression, as well as $20,000 towards Ms. Wu’s legal costs.

The message here is that a condominium corporation must take reasonable steps to address and deal with complaints from owners about common element problems. Anything less may result in a finding of oppression, and an award of damages, against the corporation.

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Powers of Attorney and Proxies

Powers of Attorney seem like simple things. Everyone has them but when the time comes that they need to be used, complications often arise. We have seen these at condominium meetings. The issue is whether or not to accept a photocopy of the power of attorney document, or even a written statement that “X has my power of attorney”, as authority to allow the “attorney” to vote or speak at a meeting of owners. More so, is the power of attorney the same as a proxy or does it have some greater authority? The decision on whether or not to accept a power of attorney at a meeting of owners, and for what purpose, is the responsibility of the chair of the meeting.

The Substitute Decisions Act (“SDA”) of Ontario is the governing statute for powers of attorney. The SDA says that a power of attorney is in force until it is revoked in writing and this revocation is either communicated by the attorney or by the person giving the power of attorney (the “Donor”). Until the condominium corporation has knowledge that a power of attorney has been revoked in writing, a properly signed power of attorney that is presented at a meeting of owners must be accepted as valid and in force.

A statement by a person who says that he/she has a power of attorney for a unit owner should not be accepted by a chair for any purpose. As well, a photocopy of a power of attorney is also not sufficient. A notarial copy of a signed power of attorney (or the original signed power of attorney) must be provided to the meeting for the attorney to be accepted as representing the Donor unit owner.

Unless there are restrictions in the power of attorney document, an attorney can do anything that the Donor can do except make a will for the Donor. This means that once the power of attorney is accepted by the meeting chair, the attorney becomes the Donor/unit owner for the purposes of the meeting. He/she can vote at a meeting and can speak at the meeting on behalf of the owner.

What is often confusing is whether a power of attorney is the same as a proxy. A power of attorney is more powerful than a proxy, in that a proxy is simply a direction from the owner to the proxy holder to vote or withhold a vote for a particular purpose or purposes. On the other hand, an attorney becomes the Donor/unit owner for the purposes of the meeting, and no proxy is needed by the attorney.

The only thing that an attorney cannot do at a meeting is to serve as a director on behalf of the Donor/unit owner. While an attorney can agree on behalf of the Donor to run for a director’s position, once elected, only the Donor can attend and take part at directors meetings.

We have seen many proper and improper uses of powers of attorney over the years. It is important for a meeting chair to understand the authority and limits of the power of attorney document.

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A Special Provision about Passing Rules

The Condominium Act, 1998 (the “Act”) says that a proposed rule can be passed either by vote of the owners, or by resolution of the Board followed by a notice to the owners (unless a requisition for a meeting is made by owners within 30 days following the Board’s notice).

From time to time the same or successor condominium boards may propose a rule or an amendment to a rule which had been previously rejected or amended by the owners. Section 58(8) of the Act deals with that situation.

According to Section 58(8), if essentially the same rule has already been rejected or amended by the owners (within the previous two years), then the proposed ‘revisited’ rule or amendment must be approved at a meeting of owners. In other words, the ‘Board notice’ procedure described above is not available for these sorts of rules or amendments.

This situation arises from time to time, and is often misunderstood or overlooked by a condominium board that may be intent on passing a particular rule.

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Bedbugs (Part 1): 5 Key Things to Consider to Reduce the Risk of an Infestation

We are hearing more and more about the risks of bedbug infestations. These risks are of particular concern in condominiums (and other “close communities”), because of the risk that an infestation can travel between residences. Here are 5 key things to consider in order to reduce the risk of an infestation:

  1. Depending upon the circumstances, the resident with the infestation may or may not be responsible. In general, we recommend that bedbug issues be treated as impersonally as possible – in order to avoid any embarrassment or shame that might delay a call for assistance.
  2. Consider sending a notice to residents and off site owners about:
    • the risk of bedbugs in a unit;
    • what bedbugs look like;
    • how bedbugs occur;
    • what to look for in their unit;
    • how often they should inspect their units;
    • any obligation pursuant to your condominium corporation’s rules to avoid the infestation of pests in the unit;
    • what steps they must immediately take to: (a) contain the infestation and prevent it from spreading to the common elements or other units, and (b) report an occurrence of bedbugs to the corporation;
    • state any consequences of not reporting bedbugs in a unit to the condominium corporation in a timely manner;
    • responsibility for the cost of treatment in a unit.
  3. Once an infestation is discovered, action must be taken quickly in an attempt to avoid the spread to other units and/or the common elements. If the unit is tenanted, be sure to communicate directly with the owner of a unit, in addition to the residents, since recovery of costs is typically against the unit owner, and they must be warned of the risks and kept informed of the problems in the unit.
  4. The board of directors and management could consider making a plan of action in advance of an infestation being discovered, in order to be able to act quickly, to address the following issues:
    1. What preventative steps will the condominium corporation take to warn residents of the risks of bedbugs?
    2. Will the condominium corporation arrange for treatment of a unit, or will owners initially be expected to eradicate an infestation in their unit? How will the cost of treatment be dealt with (keeping in mind the owners’ obligations under your declaration and rules, as well as their obligation to maintain and repair their unit)?
    3. What service providers will be used and what treatment options are available?
  5. The condominium corporation is typically responsible for the maintenance and repair of the common elements. Therefore, occasional inspections of the common element areas – including furniture, curtains, area rugs, carpets, around baseboards, and cracks in walls or other holes – are normally prudent, and might in some cases reveal the presence of bedbugs that have traveled from a nearby residence.
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