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Just in time for the first week of fall, the Summer 2009 edition of our Condo Alert! newsletter is now available here.
Topics include:
Stay tuned for the fall edition, which will be released just in time for the annual CCI/ACMO Condominium Conference in early November.
Q: What percentage of unit owners is required to approve a modification of the maintenance and repair obligations contained in a condominium declaration?
A: 90%, as required by section 107(2)(d) of the Condominium Act, 1998.
Q: If two different proxy holders show up at an annual general meeting and they each hold a proxy from the same unit owner but the proxies were signed on different dates, which proxy is valid?
A: The most recent proxy is the valid one, often because most forms of proxy contain the words: “I (We) revoke all proxies previously given.”
Q: Is it correct that no board member can sit more than 2 - 3 year terms? What happens next? Do they take a year off and run again the following year?
A: The Condominium Act, 1998 contains no restrictions as to the number of terms a director can serve. Some corporations’ by-laws may contain term limits, in which case the by-law may specify any additional restrictions or procedures. Term limits are not a very good idea because it is often hard to find volunteers willing to spend the time and effort to serve on the Board.
Anyone following the progress of Ontario’s Smart Metering Initiative and wondering how it applies to condominiums should read an August 2009 decision of the Ontario Energy Board (“OEB”) on smart sub-metering in rental buildings. See the decision here.
This case was commenced by the OEB on its own initiative as a stop-gap interim measure to try and guide a widespread frenzy of landlords outfitting their rental buildings with smart sub-metering equipment despite the fact that such installations have been expressly prohibited by law since 2005. Some landlords have actively begun downloading electricity costs to tenants, which is similarly illegal.
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The Toronto Sun reports that the impact of the proposed HST on condominium corporations and their unit owners is turning into a political football in the September 17 provincial by-election in the Toronto riding of St. Paul’s.
The opposition parties have condemned the proposed new tax because it will cause condominium fees to increase.
Finance Minister Dwight Duncan says he does not expect to see a substantial increase in condo fees, which flies in the face of the predictions made by the condominium management industry that fees will rise on average by 6 to 8%. These predictions were reported in recent months in the Toronto Star here and in the Globe and Mail here.
Notwithstanding the large number of services that the HST will affect, Finance Minister Duncan says:
"I have a condominium in Windsor and my condominium fees will likely not be affected because the services we buy are very competitively delivered."
Let me guess: His condo corporation is locking-in and pre-paying the next ten years' worth of fees for legal, accounting, engineering, property management, landscaping, contracting, housekeeping and any other service not currently subject to PST. Alternatively, perhaps this corporation has chosen to discontinue some or most of those services.
Shame on you, Minister Duncan. Rather than try to convince us that the HST is not going to have a big effect on our pocketbooks (which is decidedly untrue), you would do better to convince us that this tax is necessary and will benefit all of us in the long term.
Meanwhile, we wait to see what the voters of St. Paul's decide.
A troubled condo project in Ottawa is being taken over this week by the developer’s major creditor. The Ottawa Citizen reports that this creditor announced it is terminating the existing purchase agreements and that:
The former purchasers of the condos were told they would receive their deposits back. But it’s not clear about other expenses, such as upgrades and fixtures that have already been purchased.
This situation illustrates that while a purchaser’s deposit for the purchase price is protected by section 81(1) of the Condominium Act, 1998 (“the Act”), not all monies paid to a developer are covered by this statutory requirement that money be held in trust by the developer’s lawyer or another trustee.
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