Condo Reporter - Timely Commentaries on the Latest Developments in Condominium Law in Ontario

We are often asked by condominium corporations whether an appeal of Tarion’s final decision letter will prevent them from commencing a separate civil action with respect to the same deficiencies.

The recent decision by the Ontario Court of Appeal in Metropolitan Toronto Condominium Corporation No. 1352 v. Newport Beach Development Inc.  sheds some light on this issue.

In this case, the condominium corporation alleged two major construction defects. The first related to the sanitary system and the second related to the exterior cladding of the building.

Tarion denied the corporation compensation under the Ontario New Homes Warranties Plan Act (“Act”) with respect to both items.

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Section 132(4) of the Condominium Act (the “Act”) provides that every declaration shall be deemed to contain a provision that the corporation and owners agree to submit a disagreement with respect to the declaration, by-laws or rules to mediation and arbitration. Although section 132(4) of the Act does not require that disputes with respect to the Act itself be submitted to mediation and arbitration, based on a recent court ruling, the decision not to utilize arbitration/mediation should not be made without careful consideration.

The case of Toronto Standard Condominium Corporation No. 1508 v. Stasyna involved a common element condominium. Each of the owners of the parcels of tied lands (the “POTLs”) owned a freehold interest in their homes and adjacent backyards. The common elements of the condominium consisted of a walkway located at the perimeter of the housing development (and enclosed by a fence) and also in between some of the separate POTLs. Visually, the common elements walkway appeared to be an indistinguishable part of each owner’s separate parcel of land. A number of owners planted trees and shrubs and installed patios and stones in their backyards and on the common elements walkway, in contravention of section 98 of the Act. It appears that the owners erroneously believed that they were entitled to use and deal with that part of the common elements walkway abutting their property as if it was an extension of their backyard.  Non-compliance issues frequently arise when owners do not fully understand the obligations imposed on them by the Act and the condominium documents. 

In 2007, the Corporation wrote to fifteen owners requesting that all landscaping elements be removed from the common elements walkway, twelve of whom complied. Several years later, as three of the owners had still not complied, the Corporation called a special meeting pursuant to section 97 of the Act to authorize those changes that had been made to the common elements.  However, as the Corporation did not receive the requisite approval from 66 2/3% of the owners, the changes were not approved. (It is interesting to note that  the Board treated this as a substantial change even though there were no costs to the Corporation relating to the changes.) The defaulting owners were given an additional one-year grace period to comply. This was followed by several more demand letters from the Corporation, with the Corporation eventually commencing an application for compliance under section 134. After the commencement of the application, the owners attempted to mediate, but the Corporation refused.

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In a recent case out of Orleans, Massachusetts, the trial and appeals court found that an owner’s right to free speech trumped the by-laws of a condo association.

Steven Preu, an owner at Old Colonial Village Condominium Association, had a long-standing history of erratic and disruptive behaviour, which translated into a strained relationship with the board.  Things came to a head when Mr. Preu believed that the president of the board allowed his dog to defecate in a ‘no-dumping zone’ of the common elements.  In response, Mr. Preu left bags of feces in the no-dumping zone and labeled these bags with the president’s name.  On other occasions, Mr. Preu flipped-off management (ie: one finger salute), wrote inappropriate comments on his monthly common element fee cheques, posted signs in the condo stating that it was dirty and wedged open fire doors.  

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