Ontario Condo Law Blog

GMA Condo Alert! (Winter 2010 edition)

Chris Jaglowitz — Wed, 17 Mar 2010 06:39:11 -0500

With spring nearly upon us, it's high time to unleash the winter edition of GMA's quarterly newsletter. Enjoy it while sitting in the sunshine this week.

Major topics featured in this issue include:

Condo mediation
Workplace violence and harassment (Bill 168)
Top 10 condo law cases of 2009
Corporate Social Responsibility

Download a pdf copy here.

Microblog posts to 3/16/2010

Chris Jaglowitz — Tue, 16 Mar 2010 07:19:41 -0500

For your March break reading pleasure, here's a big bunch of tweets from our microblog:

Condo corp operating Pacific Mall in Markham announces ambitious plan to double its size and add a hotel operation - http://bit.ly/b5wmS6

Condo dustup over girl’s chalk pictures draws ire - Resident told to erase sidewalk art (via @OttawaCitizen) - http://bit.ly/cEipU5

CAI: "Overwhelming majority" of Americans are satisfied with the governance, management of their community ass'ns - http://bit.ly/ccS0cG

Condo board sues after sex toy salesman turns swank Tribeca condo unit into raucous nightclub (via NY Daily News) - http://bit.ly/djhDB6

Condo Living: Some people aren't meant to share common walls, ceilings, floors with strangers - (via @chicagotribune) http://bit.ly/91bmv9

Property tax on condos too high - Politicians back residents’ fight to lower taxes (Yorkregion.com) - http://bit.ly/dgMFL0

CCI Golden Horseshoe chapter presses for fair taxation: Condo dwellers seek a tax break (via Hamilton Spectator) - http://bit.ly/9OH9s7

Tax loophole for condo conversions could cost city millions (Windsor Star) - http://bit.ly/9jwHQB

ONCA: Condo developer adequately disclosed lease of HVAC system, per Condo Act 1990, s.52; Trial decision overturned -http://bit.ly/91MbHJ

Ontario govt regulation extending the 10 yr deadline for adequate funding of condo reserve funds is now published -http://bit.ly/9xsKRT

Bob Aaron: Victory for non-smoking condo couple in B.C. - Yourhome.ca: http://bit.ly/cs0wgL

RT @CHDW_HOALaw: Breaking news: People don't like HOA lawyers... - http://bit.ly/9CcjVs

Condo boards need more regulation - Yourhome.ca:http://bit.ly/cKj0eY. No. They need to hire a professional manager and follow advice.

RT @OntMinLabour: Ontario Increases Minimum Wage -http://bit.ly/cmodlU

Toronto condos not immune to creepy crawlies: Good night, sleep tight, don’t let the bed bugs bite - http://bit.ly/azhyyi (via Lexology)

RT @RCD_Canada: City of Toronto accepting applications for Eco-Roof Incentive Program - http://bit.ly/bzTTwg

From coast to coast, Canadian Lawyer Mag (@CanLawMag) says: Condos are hot, hot, hot! - http://bit.ly/bps7jh

Serenity now for condo folks! From @TheCooperator magazine: Anger Management-Putting the Civility back into Community -http://bit.ly/apphZu

In US, banks foreclose on condo unit owners then fail to pay common expenses, so the condos foreclose on the banks -http://bit.ly/cuGC6w

ON Govt files new training/testing regulation under Private Security/Investigative Services Act; effective April 2010 -http://bit.ly/93tIiw

What we learned at Community Association Institute’s National Law Conference - http://bit.ly/cHc3K8 (via HOALawblog.com)

"Sometimes I wonder whether being on a condo board actually kills brain cells..." - http://bit.ly/9KNSeP (via @nowhereman blog)

Best of the blogosphere for February 2010

Chris Jaglowitz — Mon, 08 Mar 2010 08:16:13 -0500

For a short month filled with Olympic excitement (Yay Canada!), there was still plenty of great condo-related stuff in the blogosphere in February.

Businesses should learn from 2010 Olympics surveillance camera debate -- Winnipeg privacy lawyer Brian Bowman emphasises the importance of having appropriate policies in place to manage the data recorded by surveillance cameras. If your condo has surveillance cameras, you need to implement proper written policies.

Association Driving You Nuts? – Take Out a Creepy Newspaper Advertisement -- Roger Wood of Arizona law firm Carpenter Hazlewood blogs about the slings and arrows hurled at HOA/condo boards and their professionals and offers some constructive suggestions to the malcontents who give “barbarians at the gate” a bad name.

Would a Condo and HOA Board Member Draft Solve Our Problems? -- Donna Berger debates condo conscription. She also offers some important negotiation tips for community association members in Association Negotiations 101!

There's No Such Thing as a "Slam Dunk"! A True Story -- California Condo & HOA lawyer Beth Grimm offers an important reminder about condo litigation. Her advice: Don't Get Bamboozled Into A Lawsuit!

When Homeowners Associations Attack -- Seattle condo and HOA attorney Kevin Britt offers advice to help directors avoid finding themselves the subject of a news headline like "HOA Sues Former Board for $70 Million".

Warning Buyers about Noisy Neighbours -- Brian Madigan of the Ontario Real Estate Blog offers a realtor’s perspective on one of the most bedevilling situations for anyone trying to sell a property.

Coping with the Demands of an Aging Population -- The estate lawyers at Hull & Hull highlight the most recent reports on the growing cost of our aging population. Are condos going to be impacted by this demographic phenomenon? You bet.

ROCs and Civil Rights -- Scott Gordon of the Resident Owned Community law blog shares his experience visiting the National Civil Rights Museum and reflects on the important connection between civil rights and community living.

Tackling rude, disrespectful conduct

Chris Jaglowitz — Sat, 06 Mar 2010 10:12:45 -0500

The Ontario Human Rights Tribunal has become an increasingly popular venue for frustrated condo unit owners to bring their grievances against condo boards and property managers. This is thanks to the low cost to file a case, simple procedure, ability to self-represent and obtain free legal advice and help. Most such cases, however, are not made in response to discrimination where a unit owner’s human rights are violated. Instead, most cases brought by unit owners are complaints relating to bad service, poor treatment, insults or rudeness by the board or manager.

While rudeness and insults to unit owners are never be acceptable, the Human Rights Tribunal is quite properly throwing out cases where the bad behaviour does not amount to legal discrimination or actual violation of human rights. The February 2010 decision of the Human Rights Tribunal in the case of Iourtchak v. York Condominium Corporation No. 201 serves as a good example.

In that case, the unit owner complained to the Human Rights Tribunal that the president of the condo board had treated her poorly by insulting her and instructing the superintendent to provide inferior service to this owner. A number of similar complaints were made by other unit owners on the same grounds.

In finding that the complaint did not disclose any facts or particulars of prohibited discrimination, the Tribunal said the following, which is probably true of a large number of condo-related cases being filed at the Tribunal these days:

While conflict in the context of accommodation can deeply impact those affected, the Tribunal does not have a general jurisdiction to evaluate relationships between condominium corporations and unit owners or to resolve all situations of rudeness, bad treatment or unfairness that may exist in a condominium environment. The jurisdiction of the Tribunal is limited to hearing applications that allege violations of the [Human Rights] Code. With respect to accommodation, s. 2(1) prohibits discrimination because of race, ancestry, place of origin, colour, ethnic origin, citizenship, creed, sex, sexual orientation, age, record of offences, marital status, family status, disability or receipt of public assistance.

While it is clear that the applicant is having difficulties with her condominium environment, there is no allegation of discrimination on the basis of one or more of the grounds protected by the Code.

The Tribunal finds that the Application does not raise matters which the Tribunal has the power to decide. Accordingly, the Application is dismissed.

Even though a human rights complaint may be thrown out, as it was in this case, the story might not end there. A condo and its board or managers may yet face other proceedings in other forums. If unit owners feel sufficiently aggrieved by shoddy treatment and insults, they will likely continue their efforts to seek redress and they may, after a long fight, ultimately be successful.

Condo directors or managers who act disrespectfully or permit disrespectful conduct to take place can and should be held to account. Similarly, condo corporations whose unit owners permit this type of toxic behaviour to pervade their environment will quite rightly bear the financial cost in some form or another and will suffer from a poor community spirit and atmosphere.

That said, unit owners who feel aggrieved by conduct of board or managers should pause, get legal advice and think carefully before launching any sort of legal proceeding. They should also keep in mind that the mediation procedure mandated by section 132(4) of the Condo Act might be especially well-suited to help resolve disputes where the issues are more social or interpersonal in nature than strictly legal or technical. Condo boards and managers would be wise to actively participate in the mediation process to find a solution in such cases at an early stage, before the issues fester and give rise to disruptive and costly diversions.

Unit owners, directors and managers should also consider whether an alternative approach to the traditional adversarial dispute resolution process might help them find a better resolution of a dispute with difficult people, be they owners, neighbours, board members, managers or others. One suggestion is to check out the famous and award-winning book (shown at right) by Professor Bob Sutton of Stanford University. The book describes a particularly sensible-sounding rule with a name that is unmentionable on this blog but is briefly described on Wikipedia here. This book might be good mandatory reading for anyone who lives or works in close quarters to other human beings.

Do you think that your condominium corporation might benefit from passing the kind of rule suggested by Professor Sutton?

Does anybody already have a rule like this? How's it working out?

Condo Act weekend giveaway!

Chris Jaglowitz — Fri, 05 Mar 2010 07:26:28 -0500

At long last, the official electronic version of the Condominium Act, 1998 has been updated to show the latest amendments made in December 2009. Most of those amendments were made by the Good Government Act, 2009, which amended over 300 Ontario statutes, and hence the long delay in updating the official electronic version of most statutes.

Condominium owners, directors and their professionals should always check to be sure they're consulting the latest version of legislation and regulations before making decisions. The best way to do this is consult the Ontario Government's e-Laws website at www.e-laws.gov.on.ca.

At the top of every statute and regulation on e-Laws is a currency date, as well as a reference to the latest amendment. See below picture.

A legislative history is also available and can be accessed from the alphabetical list of current consolidated law. The e-Laws site also hosts repealed statutes and allows you to view the wording of a specific statute at a specific point in time, which is very handy if you need to know the state of the law as of a certain date. Detailed help and FAQs are available throughout the site.

As a special feature, we're offering a weekend giveaway that tests your knowledge about our Condo Act and helps you get to know e-Laws a little better.

The Giveaway:

The first condo unit owner, director or property manager to post a comment correctly identifying the number of times the Condominium Act, 1998 has been amended wins a $25 Esso gift certificate.

Terms:

Comments must be posted on this site in response to this entry.
You don't have to give your last name.
Valid email address must be provided (it won't be displayed).
Ontario residents only.
Prize awarded in sole and absolute discretion of the author.

Good luck!

Microblog posts to 2/24/2010

Chris Jaglowitz — Wed, 24 Feb 2010 09:28:19 -0500

There were lots of newsy condo-related stories in the past month that we tweeted on our microblog. Here are some of them:

ONCA: City was grossly negligent to wait 34 hrs before salting icy sidewalks; ordered to pay $280K in slip and fall - http://url4.eu/1FAAq

BC Strata Property Act amendments now in force - http://bit.ly/aKYYyy

Way to go, #Toronto! City goes to bat for neighbours of cement plant (via Saxe Envirolaw blog) - http://bit.ly/aBEE48

OEB: Toronto Hydro breached Electricity Act by refusing to connect service to the bulk meters at new condos - http://bit.ly/akzGYV

OEB issues compliance order against Toronto Hydro to ensure new condos have choice of smart meter suppliers - http://bit.ly/b145eU

Daily Commercial News: CCDC 2-1994 contract seals being recalled, will be replaced free of charge - http://bit.ly/btTnIP

Maryland human rights body orders condo corp to halt reconversion of Shabbat elevator installed only a year before - http://bit.ly/btSFJ6

NY Times: California seaside condos and “condotels” with hefty occupancy restrictions may be hard to unload - http://bit.ly/aOfGvH

From homes-extra.ca: How to deal with noisy condo neighbours - http://bit.ly/aFJt90

From Yorkregion.com: Habitat for Humanity seeking land to build higher-density housing (condos) in Newmarket - http://bit.ly/dC9P9T

From @nydailynews: Condo coughs up $1M for victim of hushed-up crime spree - http://bit.ly/9geyw9

OHRT: Unit owner’s human rights complaint deferred until after condo’s enforcement application is heard by Court – http://bit.ly/aq2lLt

Boston Globe: Lady buys a condo unit, suffers from neighbour's 2nd hand smoke, then sues her realtor - http://shar.es/aLe8B

The Boston Globe: Jury rejects condo owner's claim that broker misled her about smoker downstairs - http://shar.es/m1yok

Obese woman in Quebec wins human rights fight with her condo for a closer parking spot - http://tgam.ca/IHc (via @globeandmail)

Blawg Review #251 by @CanadianTMBlog in Vancouver has a special Olympic theme. Go Canada! - http://bit.ly/bZpKPw

City of London (ON) considering new application/approval process for vacant land condo developments - http://bit.ly/a28dnk

RT @utahcondolaw: Park City roofing contractor's article on ice dam solutions: "Scraping by" - SNIPS: http://bit.ly/9UChiY

Connecticut Attorney General recommends creating state condo ombud & suggests funding plan (via Hartford Guardian) - http://bit.ly/9xad2Z

Charges laid after debris falls from towers, including a condo corp - http://bit.ly/byZZdu (via CBC Calgary)

If you prefer not to wait for the best next "best of" post, you can follow me on Twitter and get these updates as they happen.

CCI-T and ACMO secure concession to offset impact of HST

Chris Jaglowitz — Wed, 24 Feb 2010 04:48:15 -0500

In a special update released this week, CCI-Toronto and ACMO announced that they have successfully lobbied the provincial government to amend the regulations under the Condo Act so that corporations registered before May 5, 2001 will have 15 years (not 10 years) from the date of their first reserve fund study to top-up their reserve funds.

[Update (March 7, 2010): The regulation making this amendment is now published here.]

Condominium corporations existing as of May 1, 2001 were required to have their first official reserve fund study under the New Act within three years after that date. Generally speaking, that means that they must top up their reserve funds by the year 2016 or 2019.

CCI-Toronto and ACMO deserve kudos for securing this concession to help condo corporations offset the deleterious effects of the ever-looming HST. We wish them well in their continued negotiations with government.

Important update on Reserve Fund Change
made by the Ontario Government:

Together CCI (Toronto) and ACMO are pleased to update you on important progress we have made in our discussions with the Ontario Government related to Reserve Funds.

The provincial government has just confirmed that it will be giving condominium corporations that were registered before May 5, 2001 more breathing room when it comes to their reserve funds and the requirement to "top them up". According to the Minister of Consumer Services, this is a move the government believes will give Boards more flexibility with their budgets, and assist in taking some pressure off increasing common expenses.

Acknowledging that the statutory "topping up" deadline is fast approaching, the government agreed with our submission that it was appropriate to review the environment within which the industry is operating, including the current economic climate.

Thus the government has taken an important step by deciding that Corporations registered before May 5, 2001 will have 15 years, and not 10 years, from the date of their first reserve fund study to top up their reserve funds. This change will reduce the impact of the HST on reserve funds as any shortfall can be gradually collected or transitioned over an additional 5 years, eliminating the need for immediately seeking additional funds from owners, which would have put an additional financial burden on them.

This change will come into effect on July 1, 2010 and ACMO and CCI (Toronto) look forward to working with the government in implementing it.

This Reserve Fund extension is one of several constructive solutions that we recommended to the government and have been advocating very hard over the past year. These are solutions to try to solve many serious issues related to condominiums in Ontario, including the impact of the HST on owners. It is a greatly appreciated measure from the government that will benefit many owners in Ontario to varying degrees.

However, our work does not stop here. CCI (Toronto) and ACMO are continuing with their efforts on behalf of the condominium industry to obtain solutions to the serious and unique problems facing condominium owners, and we look forward to continuing our constructive dialogue with the government on these issues, and in particular with the Hon. Sophia Aggelonitis, Minister of Consumer Services.

Armand Conant, B.Eng., LL.B., D.E.S.S. (Sorbonne)
President, Toronto Chapter
Canadian Condominium Institute

Chris Antipas, RCM, ACCI
President, Association of Condominium
Managers of Ontario

FAQs on HRTC

Chris Jaglowitz — Thu, 18 Feb 2010 09:56:06 -0500

The Toronto Chapter of the Canadian Condominium Institute has posted a special info bulletin on how condominium unit owners can claim the Home Renovation Tax Credit (HRTC).

From the bulletin:

On behalf of CCI Toronto & Area Members, and in conjunction with ACMO, a lawyer specializing in tax law was retained to coordinate a meeting with CRA representatives in order to address many questions submitted by our members regarding the legal interpretation of the HRTC rules and how they affect the practical management of Condominium Corporations. This meeting with CRA representatives was also attended by an Auditor specializing in condominium accounting and taxation.

16 questions and answers are then provided.

See the bulletin (in pdf) here.

Kudos to CCI-T and ACMO for gathering and presenting this useful information.

Pass it on!

Best of the blogosphere for January 2010

Chris Jaglowitz — Thu, 11 Feb 2010 16:30:07 -0500

In case you spent January at the gym or fulfilling other resolutions for the new decade, here is our mini-digest of noteworthy condo-related posts from the blogosphere last month.

Enjoy the Family Day long weekend!

Records Retention: Going Paperless through E-Archives -- Paper is so passé! Marilyn Perez-Martinez of the Florida Condo & HOA Legal Blog describes some of the critical considerations in devising an electronic archive process for storing a condo’s records. The key is in preparing a sound plan.

A Building Component does not become Common Area just because it was placed or built on the Common Area -- California HOA attorney David Swedelson blogs on a recent appellate case that sounds strikingly similar to our Court of Appeal’s ruling in Wentworth Condo Corp. 198 v. McMahon.

Recognizing the Fraud Triangle -- Increase your vigilance. Florida condo lawyer Donna Berger highlights some telltale signs of fraud and how to spot them.

CCAL Seminar -- The Case Law Update – Utah condo lawyer Lincoln Hobbs blogged about the presentation of the past years' top condo/HOA cases at the US College of Community Association Lawyers' annual law conference. Other seminars were reported, including CCAL Law Conference -- The Unauthorized Practice of Law.

The 2009 Home Renovation Tax Credit and Condominiums – It’s tax season again, and property manager Tracey McLellan offers some suggestions for reporting and claiming the HRTC.

Dealing With "the Crazies" Within a Homeowner Association -- Daniel Zimberoff at the Northwest Condo & HOA Law Blog offers some advice for what is probably a remarkably rare situation that is seldom faced by condo boards and mangers.

The Sword, the Shield, and the Guide - Working with the Association's Attorney -- Kevin Britt of the Seattle Condominium and Homeowners Association Attorney Blog identifies and describes three distinct roles that a lawyer can fill when acting for a condo or community association.

Make indoor air quality test a standard part of real estate purchases -- Bob Aaron notes that people are becoming increasingly aware of the dangers of radon gas but that indoor air quality is not yet dealt with as part of real estate transactions. He also describes a number of ways to test for radon.

Toronto Hydro censured for illegal condo hookup practices

Chris Jaglowitz — Tue, 09 Feb 2010 08:53:13 -0500

In a decision dated January 27, 2010, the Ontario Energy Board ruled that Toronto Hydro breached the Electricity Act by refusing to connect hydro service to the bulk meters of new condominium projects unless all units in the condominium are individually smart-metered by Toronto Hydro and become a customer of Toronto Hydro.

The Board found that, in addition to breaching the statutory requirement to provide electrical service to buildings within the local jurisdiction, Toronto Hydro’s refusal to provide the hook-ups effectively precludes condominium corporations or developers from the option of using services of licensed smart sub-meter providers.

This highly anti-competitive behaviour is surprising, especially since nothing in Toronto Hydro’s license grants it the type of monopoly it was attempting to exercise by refusing to hook up new condo projects. Toronto Hydro raised a number of justifications for its conduct, including that the public interest is better served by this policy, but the Board rejected this, finding that these policies are actually contrary to the public interest.

Toronto Hydro also argued that its anti-competitive policies furthered the energy-conservation objectives of the Green Energy Act. The Board did not agree with the concept that the environmental imperative should trump the necessity to maintain competition in the energy market.

The Board will hear arguments and then issue a remedy (or “sentence”) in the coming weeks. Update: A Compliance Order was issued on February 22, 2010. See here (pdf).

The decision serves as a reminder that energy consumers have the ability to complain to the regulator and seek recourse when faced with strong-arm tactics and anti-competitive behaviour by utilities and service providers. In this case, the condo developers were faced with a brick wall at Toronto Hydro and they pushed back, taking this matter to the OEB.

Condominium boards should resist the pressure to hastily enter into unfavourable contracts for the installation of sub-meters, be it with their local public utility or with private sector providers. Boards need to get legal advice, call the OEB if faced with questionable or unethical business practices, and take the necessary time to consider the various options for proceeding with a sub-metering project and the ramifications of each one.

New legislative framework for suite metering

Chris Jaglowitz — Mon, 08 Feb 2010 07:31:37 -0500

People trying to keep tabs on the legislative authority for suite submetering can’t even blink these days without the risk of being left in the dark!

On December 8, 2009, the Ontario Government tabled Bill 235, an Act to enact the Energy Consumer Protection Act, 2009 and to amend other Acts.

If passed, Bill 235 will, among other things, repeal section 53.17 of the Electricity Act, 1998, which is the current authority for condominium boards to install smart meters and download electricity costs to individual unit owners. An entirely new section dealing with submetering and billing in multi-unit residential buildings will be passed, as well as a whole raft of regulations.

As with all recent energy and environmental initiatives, Bill 235 is expected to move forward quickly. Comments were to have been received by February 6, 2010. The public consultation page is here, with links to additional information. The actual wording of the Bill and its legislative status is found here.

Condo lien is not slander of title when the owner is in arrears

Chris Jaglowitz — Tue, 02 Feb 2010 03:54:49 -0500

The Ontario Superior Court of Justice recently confirmed the simple notion that a condominium lien is not slander of title where the unit owner is in arrears of common expenses at the time the certificate of lien is registered on title.

The following portion of Madam Justice Low’s decision in Jeffers v. YCC 98, 2010 ONSC 474 (CanLII) is instructive:

[52] I turn now to the plaintiffs' claim against the Condo Corporation. The plaintiffs claim damages for slander of title and for property damage.

[53] The plaintiffs allege that the registration by the Condo Corporation of a notice of lien for $967 on November 22, 2005 was a slander of title.

[54] The elements of the tort of slander of title are:

(a) that the party registering the offending instrument published words in disparagement of the complaining party's property;

(b) that such words were false;

(c) that the words were published with actual malice in that the words were published with the direct objective of causing damage;

(d) that the complaining party has sustained special damages as a result.

[55] The onus of showing that the statement was false rests on the plaintiffs.

[56] The plaintiffs have not met the onus of showing that the Condo Corporation made a false statement.

After reciting the relevant evidence as to the debits and credits, Her Honour found that the unit owners were clearly in arrears of common expenses at the time the lien was registered. She then went on to say:

[72] I find that the plaintiffs have not met the onus of proof of showing that the notice of lien was false. There is no need to deal with the other elements of the cause of action. I find that the claim for damages for slander of title fails.

Justice Low then dismissed the claim for slander of title, as well as an unrelated claim over property damage. She further dismissed the unit owners’ claims against their bank over the amount owing on their mortgage.

Because they were completely successful at trial, the condo corporation and the bank were each awarded part of their legal costs. The plaintiffs (who represented themselves in the lawsuit) were ordered to pay costs of $20,000 to each defendant, representing about half of the total costs paid. In reaching her decision about the precise amount of the costs to be paid, Her Honour considered that:

The plaintiffs appear genuinely, although mistakenly, to believe that they have been treated oppressively. On the evidence before the court however, it is apparent that the plaintiffs have been the authors of their own misfortunes through their failure to appreciate the consequences of and to take responsibility for their actions and inactions, their failure to appreciate that their litigation conduct was increasing the costs which might be awarded against them, and their apparent unwillingness to take legal advice.

This observation is strikingly familiar to us condo lawyers because it accurately describes the situation in most lawsuits brought by unrepresented unit owners against their condo corporations. The outcome of those sorts of lawsuits is invariably bad, with serious financial consequences both for the unit owner plaintiffs and the defendant condominium corporations.

Unit owners with a problem with their condominium corporation should get legal advice as to whether they have a case before they start a lawsuit. They should then follow their lawyer's advice.

Talking back - employers' vicarious liability

Chris Jaglowitz — Thu, 28 Jan 2010 07:07:34 -0500

Bob Gardiner reminds us that the grace period for the ban on hand-held devices while driving is coming to an end.

*********

Now it is illegal for drivers to talk, text, type, dial or e-mail using Blackberrys, cellphones and similar hand-held devices.

Bill 118, the Countering Distracted Driving and Promoting Green Transportation Act, promoted by the Ministry of Transportation, took effect on October 26, 2009. A three-month probationary educational period will end February 1, 2010, when police will begin issuing tickets to offenders, resulting in fines of up to $500.

Employers, such as property management companies, could be held vicariously liable for payment of fines or damages arising from an injury or accident deemed to have been caused by an employee’s inattention to driving while manipulating a hand-held device. It is recommended that employers issue the company’s no hand-held policy to employees prohibiting use of hand-held devices while employees drive a car, except in accordance with permitted hands-free technology such as Bluetooth. It is expected that if a driver involved in an accident was found to be using a hand-held device at the time of a collision, such unlawful use may more likely be deemed to be the cause of an accident and possibly result in a higher award of damages against such a driver and employer. Delivery of a no hand-held policy to employees should exempt employers from vicarious liability.

Studies indicate that drivers using cellphones are four times more likely to crash, while those texting messages may be the cause of approximately 20% of all collisions. Ontario has joined 50 other countries and several Canadian provinces which enforce rules against driving while using a hand-held device.

Drivers who need to gab while driving will still be entitled to use hands-free technology such as can be provided by various Bluetooth devices. Choose systems which allow vocal dialing or speed-dialing of your favorite numbers.

Firefighters, paramedics, police and drivers dialing 911 will be excepted from enforcement of that law. Regulations dealing with other exempted cell phone scenarios are also being enacted.

Best of the blogosphere for December 2009

Chris Jaglowitz — Wed, 27 Jan 2010 10:13:50 -0500

With the twenty-tens now well underway, let’s look back at some of the best of the condo-related blogosphere for the last month of the “aughts.”

New Year Resolutions for Boards – Colorado lawyer Molly Foley-Healy of the HOA Legi-Slate blog suggests three new years’ resolutions that any condo or HOA board should make. It’s not too late!

10 Tough Questions with Herman Turkstra - The Hamiltonian blog picks the brain of local institution, lawyer and former politician Herman Turkstra on Steeltown’s successes, failures and future.

How Much Are My Condo Fees Per Square Foot? – In a recently-launched blog called It’s a Condo Life, Oshawa property manager Tracey McLellan shines some light on how comparing common expenses of different buildings can be confusing.

Enforcing CC&Rs Through Electronic Surveillance -- Daniel Zimberoff of the Northwest Condo & HOA Law Blog suggests that better surveillance may lead to better compliance with covenants, conditions and restrictions and can simplify rule enforcement cases.

Condominium corporation approval for hot tub not needed? -- Toronto Lawyer and blogger James Morton shows us the guts of the Ontario Court of Appeal’s decision in the famous hot tub case of 2009, WCC 198 v. McMahon.

Well... Everyone Knows It: The Testimony of a Mold Expert -- Mark Wiechnik of Stark & Stark’s New Jersey Law Blog takes on the popular conception that toxic mould causes serious health issues in humans. Judging from the number of lawsuits, mould seems like the bogeyman of our time, notwithstanding that the link between mould and harm to human health is far from clear. A provocative piece.

How To Enforce Civil Judgments in Ontario – If you ever wanted to learn about how we turn a court order into money in the bank, see this entry by Toronto insurance lawyer Pamela Pengelly on her Res Ipsa Loquitor blog.

Microblog posts to 1/26/2010

Chris Jaglowitz — Tue, 26 Jan 2010 15:18:48 -0500

Here is a sampling of the recent posts on our microblog:

Lincoln Hobbs on this years' top condo/HOA cases at US College of Community Ass'n Lawyers ' annual law conference - http://bit.ly/7gPi6n

RT @canetwork: NY: Condo complex fined $10,000 for barring mezuzah - http://bit.ly/8NhaGi

RT @CondoVultures: Banks seize 30,000 South Florida properties In 2009, according to CondoVultures.com - http://tinyurl.com/yzg4bsg

Audrey Loeb speaks to Law Times about recent ONCA decision in “hot tub case” known as WCC 198 v McMahon - http://bit.ly/6qrZAK

Ottawa Citizen: Condos give homeless hope - Mental health association comes to the rescue - http://bit.ly/6tXO6v

D.C. condo unit owner wins [settles?] court battle with smoker next door - http://bit.ly/6i8VAg

Ottawa Citizen: Condo mgmt demands removal of big snow fort built by unit owner for his kids in his front yard - http://bit.ly/4sGvA5

More pics of massive snow fort on front yard of Ottawa townhouse condo illustrates safety hazard - http://bit.ly/939xCQ Cool fort, though!

DC Real Estate Guide writes on the pros of joining your condo board - http://bit.ly/4oaeft - and also the cons - http://bit.ly/6tmyWx

ONCA: Condo corp's insurance doesn't cover replacement of poorly-designed standpipe system - http://bit.ly/4QeBtM

Before you buy Florida condos in distressed neighbourhoods, take note: RT @canetwork: With foreclosure comes crime - http://bit.ly/831NPS

Barrie (ON) Examiner reports on condo development trends in that town: "Condo owners living the high life" - http://bit.ly/5QXy3R

Costs to soar as aging Canadians face rising tide of dementia - Globe and Mail: http://bit.ly/5ZfUuJ - How about cost to condo corporations?

New Brunswick to ring in the new year with a new Condominium Property Act - http://bit.ly/5OH5fu

Learn more about the microblog here, or follow me on Twitter - @chrisjaglowitz - to get live updates.

Protect your condominium community against fraud

Chris Jaglowitz — Sat, 16 Jan 2010 12:10:49 -0500

The following guest post is by Athena Mailloux, a fraud examiner at ZAP Consulting Limited. Athena shares some practical solutions to help condo directors keep their new years’ resolution to be vigilant against fraud.

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Whether you are a large business corporation or a sole proprietorship you can never be too cautious when it comes to protecting against fraud. Condominium corporations have no less of a responsibility in protecting against fraud than a publicly traded company. In fact, condo corporations are often relatively small, close-knit communities that may lack stringent internal controls and thus be more susceptible to fraud.

Organizations such as condo corporations need to be even more vigilant for deception and fraud in the wake of the recent economic downturn. A Google search for “condo fraud” returns an almost endless list of fraud instances in condo communities, many of which could have been prevented by simple due diligence and good corporate governance. The fraud instances listed range from fabricating invoices for maintenance and repair work to illegally selling parking spaces and misappropriating trust funds. Frauds were committed by employees, members of the board of directors as well as vendors taking advantage of an opportunity to defraud the condo corporation.

It is important to remember that the cost of protecting against fraud often outweighs the damage resulting from it. For example, it typically costs less than $100 to obtain a background check (with consent) on a potential employee, member of the board of directors or vendor, whereas the damage done by a fraudulent employee, director or vendor may far exceed that amount.

The following simple, cost-effective internal controls can go a long way in protecting your condo community from fraud.

Accounting and Finance

1. Use a secure, password-protected accounting system to track transactions. This type of software can be purchased off the shelf at any retail office supply store. The corporate auditor should be the only one with the “accountant” password.

2. Set up all corporate financial accounts to require two signatures for all transactions including cheques. Often it is wise to have one of the signing authorities be a board member and the other the property manager.

3. Cheques used by the corporation should be of the pre-numbered variety. Cheques should be locked away when not in use.

4. Wherever possible expenses should be paid for by cheque.

5. Avoid issuing corporate credit cards. If corporate credit cards are in use, carefully scrutinize each transaction on credit card statements.

6. Depending on how active your condo corporation is, set up a policy that all cash transactions (no matter how small) must be recorded daily and deposited either daily or weekly.

7. Keep a petty cash amount on hand for emergencies. Often less than $50 is sufficient. Track all usage of these funds through “petty cash slips”.

8. Any investments of corporate funds should be made through a reputable and licensed broker. All investments should be purchased in the name and address of the condo corporation only and no other names should appear on the instrument.

9. Financial statements should be presented to the board of directors on a monthly basis. It is the responsibility of the board to satisfy themselves that the statements accurately reflect the condo corporation’s financial status.

Hiring and Contracting Process

Ensure that you have a competitive hiring process in place. Interview or invite bids from at least three separate people or corporations. Once you have narrowed down the selection process to the three top candidates, get their consent (in writing) to perform a due diligence check, which may include any or all of the following:

Criminal background check
Credit check
Previous work experience
Reference(s)
Driver’s License Verification
Any other type of due diligence that may be required.

Insurance

The condo corporation and its manager should have adequate fidelity insurance policies in place that cover all employees, management and the board of directors. What counts as adequate insurance may be debatable, but a good rule of thumb is to insure at least up to the value of all funds and assets that could be at risk. Obtain legal and financial advice to make sure the condo corporation has proper coverage.

Be Proactive

Adequate measures to prevent and protect against fraud are essential for every organization, including condo corporations. Failure to have such measures in place can lead to disastrous consequences and potentially huge losses for your condo community. The benefits of adequate protection against fraud far outweigh the costs.

Alberta case affirms powers of condo board

Chris Jaglowitz — Mon, 04 Jan 2010 07:44:20 -0500

A February 2009 decision of the Alberta Court of Queen’s Bench should be added to the list of notable condo cases for 2009. Check out Dykun v. Cravenbrook Condominium Corporation No. 032 1893.

After changing managers on December 1, 2007, the condominium’s board discovered that the previous manager had improperly withdrawn money from the reserve fund to pay operating expenses, leaving the corporation on the brink of insolvency.

Two months later, the board announced that it was levying a special assessment to raise the money necessary for the corporation to continue operating and to replenish the reserve fund.

One unit owner fought tooth and nail to resist paying his $800 share of the $80,000 special assessment. He brought an application against the board and argued that the corporation should have exhausted alternative options before it levied the special assessment. The owner presented one alternative strategy and asked the court to set aside the board’s decision and to implement his suggested strategy.

In dismissing the application, the court found that the board had acted prudently and responsibly in asking and following the advice of the corporation’s solicitors and auditors to levy the special assessment. The court did not agree with this unit owner’s proposed strategy and went on to say:

Even assuming that Mr. Dykun’s solution was an appropriate one, he cannot force his views on the Board of Directors. Management of the affairs of Cravenbrook rests with the board and not with any single unit owner. The Board has been properly elected to oversee Cravenbrook’s affairs. Mr. Dykun has not. Mr. Dykun cannot dictate to the board the course of action that they should be following. If he is interested in having a greater say in how the overall affairs of Cravenbrook should be managed, he should seek election to the board of directors.

This approach seems like a good answer to cases where owners look to second-guess decisions of the elected board. The decision in this case further affirms the concept that the board has the final say in managing the corporation’s business, whether in budgetary matters or in selecting the colour scheme for the corridor refurbishment project.

What do you think?

Top 10 condo law cases of 2009

Chris Jaglowitz — Thu, 31 Dec 2009 12:20:56 -0500

As 2009 drifts into the history books, we look back at some of the notable condo law decisions made by Ontario courts and tribunals in the year gone by.

Here are ten of them, in no particular order. Click the bolded case names to view full text decisions at Canadian Legal Information Institute ("CanLII").

#1 - Nipissing Condominium Corporation No. 4 v. Kilfoyl, 2009 CanLII 46654 (ON S.C.)
Corporation obtains a compliance order against owners operating a boarding house in violation of the “single family residence” provision in the declaration. The owners unsuccessfully claim that the case must first be mediated/arbitrated (as per Condo Act s. 134(2)), and that the single family use provision violates the Human Rights Code. The case is now under appeal.

#2 - Metropolitan Toronto Condominium Corporation No. 1250 v. Mastercraft Group Inc, 2009 ONCA 584 (CanLII)
The Court of Appeal makes important rulings on the following interesting issues in this nightmare case over a conversion building:

When does a subsequent landowner become a “declarant”
Whether fixtures can be separated from common elements by the declarant and then leased to the condo corporation
What factors must be considered in determining whether a construction warranty is breached.
Whether the right to rent a parking spot is an easement appurtenant to each residential unit

Application for leave to appeal this case has been made to the Supreme Court of Canada [and dismissed].

#3 - Carleton Condominium Corporation No. 26 v. Unit Owners, 2009 CanLII 22548 (ON S.C.) Condo successfully applies to amend its declaration in order to fix inconsistencies over the maintenance/repair obligations and boundaries of the units. Good discussion about Condo Act sections 107 and 109 and about how to properly set the stage for bringing such an application.

#4 - Ottawa-Carleton Standard Condominium Corporation No. 650 v. Claridge Homes Corporation, 2009 CanLII 25983 (ON S.C.)
Court rules that a condo corporation can sue Tarion for payment out of the guarantee fund for construction deficiencies, and that the claim against Tarion can be made with or without the declarant. Filing the performance audit under Condo Act section 44 is the only prerequisite.

#5 - 1240233 Ontario Inc. v. York Region Condominium Corporation No. 852, 2009 CanLII 1 (ON S.C.)
In this case about a shopping mall converted to a commercial condominium corporation, a unit owner applied unsuccessfully for an oppression remedy when asked to contribute to the mall’s promotional fund. The court found that the corporation can spend money from the common expenses fund on promotions and marketing. Such expenditures are consistent with the duty to manage and administer the corporation.

#6 - Wentworth Condominium Corporation No. 198 v. McMahon, 2009 ONCA 870 (CanLII)
The central issue was the meaning of the words “addition,” “alteration” and “improvement” as in Condo Act section 98. The Court of Appeal upheld the trial judge’s ruling that installing a hot tub is not an addition, alteration or improvement to the common elements. The court pointed out that some cases may require a different approach and that each case must be considered individually.

#7 - McMillan v. Bruce Condominium Corporation No. 6, 2009 HRTO 878 (CanLII)
The Human Rights Tribunal dismissed an owner’s complaint that the corporation violated the Human Rights Code by requiring the owner to pay the cost of modifying the common element stairway to his townhouse in order to accommodate his disability. See our case comment here.

#8 - DiSalvo v. Halton Condominium Corporation No. 186, 2009 HRTO 2120 (CanLII)
The Human Rights Tribunal ordered a condo corporation to install and pay for a modification to an owner’s exclusive use common elements in order to accommodate that owner’s disability, quite contrary to the ruling in McMillan v. BCC 6, above. The tribunal also fined the corporation $12,000 on the basis that the corporation violated the owner’s human rights in poorly handling the owner’s request for accommodation. This December 2009 case will get close review and further comment in the weeks ahead.

#9 - Metropolitan Toronto Condominium Corporation 626 v. Bloor/Avenue Road Investment Inc., 2009 CanLII 44718 (ON S.C.)
Interesting municipal law case about a mixed-use complex with shared parking and a screwy site plan agreement and zoning by-law. When the parking lot owner jacks up the parking rates, the residential condo owners sue for a declaration that a certain number of the spots are allocated to them. The court disagreed.

#10 - Metropolitan Toronto Condominium Corporation No. 932 v. Lahrkamp, 2009 ONCA 362 (CanLII)
A unit owner who made incessant requests for records and harassed board and management staff was ordered by the Superior Court to stay away from the management office and to follow a special procedure for requesting records. On appeal, the Court of Appeal set aside the restraining order as being too extreme for these circumstances but affirmed the rest of the order. We commented on the original decision here.

One decision from late December 2008 also deserves mention.

Metropolitan Toronto Condominium Corporation No. 946 v. J.V.M., 2008 CanLII 69581 (ON S.C.)
Condo corporation obtains a court order to sell a unit owned and occupied by a person with mental health issues who had breached previous court orders requiring the owner to rectify unsafe and unsanitary conditions. Court found that the corporation had done its best to accommodate the owner’s disability.

Did we miss any cases that you would include in this list? Let us know!

Thanks for following our blog this year. All the best for 2010.

Microblog posts to 12/27/09

Chris Jaglowitz — Sun, 27 Dec 2009 13:38:08 -0500

Here are some of the postings from our microblog over the past month.

RT @Assocpropmgt: Ancient Homeowner Association Rules from Smithsonian Magazine - http://bit.ly/4LGNGE

Innisfil (Ont) Journal: Big Bay Point Resort seeks conversion to special act corp; more “flexible” than condo corp - http://bit.ly/8S33sA

RT @habitatmag: Co-op / Condo Boards: An expert reveals: The Top 15 Mistakes New Board Members Make - http://tinyurl.com/yhye4dx

RT @ColoradoHOAGal: RT @tedleew: "Top 7 insane homeowners association rules - THE WEEK" http://j.mp/4wLhnD

Ont. Human Rights Legal Support Centre reports on "ground-breaking legal victory" for disabled condo unit owners - http://bit.ly/5MlI0l

Toronto Globe and Mail: Queen's Park vista threatened by condo plan - http://tgam.ca/FUL

RT @canetwork: FL: HOA Prez choked by resident over Christmas light dispute http://bit.ly/82aZbs

ONCA: Installation of outdoor hot tub is not an “addition, alteration or improvement” under s. 98 of Ont. Condo Act - http://bit.ly/7eaNsM

RT @HOA_Lawyer: HOA director apologizes for giving man "the finger" at owners meeting. She's also an etiquette coach! - http://bit.ly/4IR7Jg

HUD charges Massachusetts condo bd and mgmt co. for discriminating against families with children - http://bit.ly/7AioLc

RT @nicolebreskin: $2.1 million Tribeca condo owner to sue neighbor over secondhand smoke - http://bit.ly/7KTpeq

Biscayne Times: Condo Life-Luxurious Comfort or Relentless Conflict? - http://bit.ly/6Nwd1y - Bizarre tale of Miami development gone bad.

Anon. Chicago lawyer: HOAs that ask war vets to remove flags are "a good reason why my kids will go to college." - http://bit.ly/7FcD2R

National Post: City of Toronto orders condo developers to buy annual metropass for every unit: http://bit.ly/6615FT Neat idea!

Learn more about the microblog here, then follow me on Twitter - @chrisjaglowitz.

Further amendment to Condo Act increases choice for investing condo funds

Chris Jaglowitz — Wed, 23 Dec 2009 11:29:24 -0500

Another small amendment to our Condo Act came into force on December 15, 2009, this time by virtue of Bill 218, the Ontario Tax Plan for More Jobs and Growth Act, 2009.

Clause (b) of the definition of "eligible security" in subsection 115(5) of the Condominium Act, 1998 is amended to include certain financial instruments issued by institutions located in Ontario insured by the Deposit Insurance Corporation of Ontario ("DICO").

Subsection 115(5) now reads as follows (with amendment underlined):

Definition

(5) In subsections (6) and (7),

“eligible security” means a bond, debenture, guaranteed investment certificate, deposit receipt, deposit note, certificate of deposit, term deposit or other similar instrument that,

(a) is issued or guaranteed by the government of Canada or the government of any province of Canada,

(b) is issued by an institution located in Ontario insured by the Canada Deposit Insurance Corporation or the Deposit Insurance Corporation of Ontario, or

(c) is a security of a prescribed class.

In practical terms, this amendment allows condominium corporations to purchase investments issued by credit unions or caisses populaires that are located in Ontario and are insured by DICO. This effectively destroys the monopoly enjoyed until now by CDIC-insured banks and trust companies and provides greater choice of investment products and providers.

A list of CDIC-insured institutions is here. A list of DICO-insured institutions is here.

Condominium corporations that are unhappy with the investment choices offered by their banks now have more flexibility as to where to purchase investments. This provides considerably more leverage when negotiating rates and terms. Choice is good.