Ontario Condo Law Blog : Toronto Condominium Lawyer & Attorney : Gardiner Miller Arnold Law Firm : Ontario, Ottawa, Hamilton, Kitchener

Facts

From the decision itself:

[2] Ms. Jia is 45 years old. She immigrated to Canada with her young son in 1998. Trained as a professional engineer, Ms. Jia became a full time real estate agent in November 2001 and has worked with Re/Max Crossroads Realty Inc. since October 2005.

[3] Mr. Keeley started employment as the first relief superintendent with Forest Vista on December 1, 2006. He was on its board from 2002 to 2008 and owned a condominium unit in the building until 2005. Prior to his employment with Forest Vista, he spent over thirty years as a police constable with the Toronto Police Services from which he retired in 2006.

[5] The following facts are undisputed. In the early evening of January 31, 2007, Ms. Jia went to the 61 Town Centre Court condominium complex to meet her clients, Yi Bing Gao and Shu Ye, who owned unit 2001. They were in the process of selling their condominium unit and wished to retrieve the unit’s keys from their tenant who was moving out of the unit, return the tenant’s deposit, inspect the unit, and obtain a status certificate from Forest Vista. Ms. Jia was the listing agent on the sale of unit 2001.

[6] Mr. Gao and Ms. Ye tried to obtain a key to their unit from Cecilia Badu, the security guard employed by Del Property who was on duty that evening. They became angry with her when she could not give them a key or access to their unit. Ultimately, they reached their tenant at his new residence and arranged to meet him there to obtain keys to the unit. They asked Ms. Jia to wait for them in the inner lobby of the condominium unit, which she did, with Ms. Badu’s permission.

[7] Responding to a call from Andrea Cooper, the Condominium Manager of Forest Vista, arising out of Ms. Badu’s conversation with the unit owners, Mr. Keeley approached Ms. Jia who was sitting in the inner lobby. It is not disputed that Mr. Keeley asked Ms. Jia to leave, that she did not immediately comply with his request, and that he subsequently physically ejected her from the inner lobby.

[8] The security camera located in the exterior lobby of the building recorded the exit by Mr. Keeley and Ms. Jia from the inner lobby and their interactions in the exterior lobby of the condominium.

Unfortunately, the camera did not capture the assault that took place in the inner lobby. As a result, this case is a classic “he said, she said” story that makes for interesting reading for “Law and Order” fans.  

First question: Was Ms. Jia trespassing?

After considering all the evidence, the court found:

[78] In the present case, I find that Ms. Jia was not trespassing. She had been given permission by Forest Vista’s authorized agent to remain in the lobby. As Mr. Keeley admitted, security guards would ordinarily ask trespassers to leave. Ms. Badu did not ask him to remove Ms. Jia or issue a trespass notice or ask Ms. Jia to leave because she was sitting quietly. Without reasonable explanation or justification, Mr. Keeley peremptorily revoked that licence.

[79] As a result, I find that Mr. Keeley had no reasonable basis for asking Ms. Jia to leave, for arresting her or for ejecting her.

Second question: Was Mr. Keeley justified in using force and did Mr. Keeley use reasonable force to eject Ms. Jia as a trespasser?

[80] The force that Mr. Keeley used was unnecessary in the circumstances of this case. Even if he had good reason to arrest and eject Ms. Jia, the force that he used was excessive.

[81] While there is no question that occupiers may direct persons to leave their property, as the defendants acknowledged, it must be done on a reasonable basis. An occupier must consider whether the use of force is a necessary or reasonable course of action in the first place and whether it might lead to a confrontation more serious than the alleged trespass. The latitude shown to a police officer will not necessarily be shown to an occupier who is under no duty to act and who instigates a confrontation with a trespasser, as I have found Mr. Keeley did in the present case.

[82] On January 31, 2007, Mr. Keeley weighed 230 pounds; and he is 5 feet and 10 inches tall. On that date, Ms. Jia weighed 110 pounds. She is around 5 feet four inches tall. Ms. Jia was thrown on the floor by Mr. Keeley and she landed on her back. She was inert just before he pinned her to the floor with his knee on her chest and his hands to her throat.

[83] There can be no justification for this kind of excessive force in the circumstances of this case as I have found them.

Third question: Did Ms. Jia willingly assume the risk of injury?

[86] As I have already found, Ms. Jia’s refusal to comply immediately with Mr. Keeley’s request that she leave was reasonable in the circumstances of this case where she had been permitted to stay, had done nothing wrong, and there was no reason for her to leave. Mr. Keeley overreacted and did not give her a reasonable opportunity to understand the situation and to comply before he physically arrested and ejected her.

[87] In these circumstances, it is not reasonable that Ms. Jia should have assumed that her mild resistance would have led to the kind of physical and dramatic altercation that ensued with Mr. Keeley. As Ms. Jia stated, if she had known that she was going to be assaulted, she would have left immediately and waited in her car for her clients’ return.

[88] When Ms. Jia reasonably questioned his authority, given Ms. Badu’s permission for her to sit in the lobby, Mr. Keeley overreacted and the situation escalated out of control. Ms. Jia was not given a reasonable time to comply. As Mr. Keeley ruefully acknowledged during his cross-examination, he wished he would have done things differently.

Fourth question: Is the property management firm liable for any losses suffered by Ms. Jia?

[89] As occupier of the premises, Forest Vista has a positive duty to take such care as is reasonable to keep the premises reasonably safe for all persons in attendance. Forest Vista, as Mr. Keeley’s employer, and not Del Property Management, is vicariously liable for Mr. Keeley’s actions.

[90] No employee or agent of Del Property participated in Mr. Keeley’s assault and battery of Ms. Jia. There is no evidence that Ms. Badu saw Mr. Keeley assault Ms. Jia and fail to intervene. As Ms. Jia and Mr. Keeley both testified, the altercation occurred very quickly. According to Ms. Badu’s uncontested evidence, she did not see Ms. Jia and Mr. Keeley until they emerged into the outer lobby. By the time that she returned to the window of the security office and saw them, Ms. Jia and Mr. Keeley had disengaged.

[91] As a result, I do not find that Del Property Management is liable for any losses suffered by Ms. Jia.

Fifth: What damages, if any, did Ms. Jia suffer?

The plaintiff sought money under four different heads of damages in this case. The court considered each of them in turn.

General Damages

[110] The evidence establishes that Ms. Jia suffered extensive bruising, three broken ribs, and significant emotional distress as a result of the assault committed by Mr. Keeley.

[111] Ms. Jia was unable to sleep, had to take heavy pain and sleeping medications, could not care for her young son, drive or return to work for several weeks, and she suffered considerable physical and emotional pain for many months. She continues to have pain when the weather changes.

[112] Based on my survey of the case law provided, these circumstances warrant an award of general damages in the amount of $30,000.

Aggravated Damages

[113] Ms. Jia asks to increase the award of general, non pecuniary damages because of aggravating features of Mr. Keeley’s conduct.

[114] Aggravated damages are intended to compensate a plaintiff whose injuries have been exacerbated by particularly outrageous conduct. They are appropriate where a defendant’s conduct has been particularly high-handed or oppressive. In particular, in cases of assault and battery, aggravated damages have been awarded if the assault and battery occurred in humiliating or undignified circumstances.

[115] In my view, this case warrants increasing the award of general damages because of the particularly aggravating and high-handed conduct of Mr. Keeley for which Forest Vista is also vicariously responsible. As I have already found, the force used by Mr. Keeley was excessive and unnecessary in the circumstances of this case. It was particularly humiliating to Ms. Jia, a professional woman, to be dragged out of the lobby, where she was quietly waiting for her clients, flung to the ground and pinned there by Mr. Keeley. She then had the embarrassment of having to explain to her family and clients what had occurred.

[116] Mr. Keeley has never apologized to Ms. Jia for his conduct. Instead, as I have found, he constructed an elaborate fabrication of what occurred in an attempt to avoid responsibility for his miscalculation and overreaction. To make matters worse, Mr. Keeley laid a private complaint of assault against Ms. Jia; and he misrepresented what occurred to Forest Vista so that the latter wrote an accusatory letter about Ms. Jia to her real estate broker through whom she earned her livelihood and to whom she, again, had to suffer the humiliation of explaining what had occurred.

[117] Mr. Keeley’s conduct during the assault and afterwards had the effect of increasing Ms. Jia’s humiliation and anxiety and worsening her mental and physical conditions. As a result, Ms. Jia is entitled to aggravated damages in the amount of $8,500.

Pecuniary Damages

[118] Ms. Jia claims the amounts of $995.13 as OHIP’s subrogated claim and $45.00 for Ms. Jia’s ambulance bill. These amounts are not contested and I allow them.

[123] Although at first glance it appears that Ms. Jia did not suffer any loss of income for the weeks missed in 2007, the evidence establishes to my satisfaction that she suffered an income loss of at least $10,000 . . .

[124] In consequence, I hold that Ms. Jia has suffered a loss of income of $10,000 as a result of her absence from work during the period February, March and April 2007.

Punitive Damages

[125] Finally, Ms. Jia submits that the assault committed by Mr. Keeley justifies an award of punitive damages.

[126] The Supreme Court of Canada in Whiten v. Pilot Insurance Co. set out thorough and helpful guidelines to assist courts in determining whether and when punitive damages should be awarded. . . .

[127] Applying the above noted criteria to the present case, I am of the view that, while Mr. Keeley clearly and inappropriately overreacted in his interactions with Ms. Jia, I do not believe that his conduct at the time of the assault reached the extraordinary stratum of vicious outrageousness that would require this court’s further denunciation and punishment, such as was the case in Herman v. Gironda and Dogan v. Pakulski.

[128] Further, it can be said that Mr. Keeley has already been punished under the criminal law in that the assault charges were dropped against him because he agreed to enter into a peace bond.

[129] As a result, I decline to award punitive damages.

The Result:

The plaintiff obtained a judgment for $49,540 against the condominium corporation and the superintendent. The court found that these defendants were jointly and severally liable to pay, meaning that the plaintiff can collect the money from whoever she wishes. As a practical matter, the condominium corporation would be the easy choice. The condo and the super can subsequently fight amongst themselves over who will (or who can) ultimately pay the judgment, but there is typically no reasonable prospect of collecting money from an employee in such circumstances.

The claim against the property management firm was dismissed.

In addition to the principal amount, interest is payable in this case, and potentially the plaintiff’s legal costs as well as whatever legal defence costs are not covered by insurance. The total outlay could be $100,000 or more on an expenditure that most unit owners would definitely not be pleased with.

Lessons:

1.  Employers are vicariously liable for the acts of their employees. As always, condo corporations should be careful about who they hire and should discipline/terminate employees who demonstrate violent tendencies towards people.

2.  It is also important to make it precisely clear as to who the employer is – either the condo or the management firm. This should not be vague or uncertain.

3.  Condominium corporations are the “occupiers” of their common elements and, as such, have a positive duty to take such care as is reasonable to keep their premises reasonably safe for all persons in attendance. This means more than clearing ice and snow.

4.  It should be a written policy that ejecting trespassers be left to trained security personnel or, better yet, the police. In this day and age, there is no room for the cowboy tactics demonstrated in this case. Consider the result if this super had gotten himself shot or stabbed during a physical confrontation with a trespasser.

5.  Management is responsible to oversee staff and has a duty to act immediately and effectively if they observe staff exceeding their mandates or acting badly towards other people. Had the property management firm or its employees witnessed the assault and done nothing, they might have been found partly liable in this case.

6.  Have a clear written policy on the role of the concierge/security guard when it comes to handling keys and permitting access to suites. The confrontation in this case began when the unit owners and their realtor unsuccessfully sought access to a suite.

7.  Condo corporations should ensure that their insurance specifically covers the acts (including criminal acts) of its employees.

8.  As for municipal elections and canvassing, it is both unwise and illegal to interfere with candidates and their representatives making reasonable access to condominium property for canvassing or distributing election material. See section 118 of the Condominium Act, 1998.

For full text of decision, see here.

The decision to reduce or avoid using lawyers in pursuing claims for construction deficiencies is typically made in order to save money. This is often a poor choice and can lead to a host of unfortunate scenarios, including the following:

1. Unsuccessfully pursuing claims clearly not covered by the Tarion warranty;
2. Pursuing claims of a value greater than the new monetary cap;
3. Missing the limitation period for commencing appeals of Tarion decisions;
4. Missing the new deadlines to request conciliation, resulting in unintentional withdrawals of warranty claims;
5. Missing the limitation period within which to commence an action in court;
6. Allowing the developer to divest itself of assets and fade away without making good on its financial obligations;
7. Being “outgunned” by the developer’s legal team;
8. Settling for far too little money or pushing too far for too much;
9. Unknowingly releasing the developer from other viable claims without receiving adequate value;
10. Getting bogged down in procedural quagmires; and (as a bonus reason),
11. Almost any combination of any of the above.

Any of these situations will likely cost the corporation many times more than the possible cost savings of embarking on the construction deficiencies claims process without the help of a suitably qualified lawyer. This is a classic example of condo boards being “penny wise, pound foolish.”

Experienced property managers recommend that their condominium boards obtain legal advice about pursuing construction deficiencies claims at an early stage. In addition to having too little time to properly address the important issues that arise in a construction deficiency claim, property managers are neither trained nor insured to advise boards on the different legal ramifications of proceeding by way of Tarion rather than pursuing a claim in court. As a result, property managers are generally not in a position to give proper advice on these important issues and they typically recognize the limits of their ability when it comes to these complex legal areas. A lawyer with expertise in condominium and construction law can provide the necessary advice and help devise an effective plan to guide boards and their managers through the construction deficiency maze.

In addition, an inherent conflict arises when a property manager appointed by the developer (while in control of the condo corporation before turnover) is asked to advise the post-turnover board as to whether or how to pursue a claim against the developer for construction deficiencies. It is arguable that a manager appointed by a developer-controlled board may be tempted to give advice to the owner-controlled board that favours the developer’s position, to the detriment of the corporation and its owners. For this reason alone, it is essential that the board engage a lawyer to obtain an objective, impartial opinion to consider and act upon. Managers should (and generally do) encourage this approach, as it effectively cleanses any appearance of possible impropriety or undue preference and ensures that the board receives good advice. Good managers focus on “managing” life for a new condo corporation and can readily spot situations that require the involvement of another professional or specialist. Conversely, managers that do not recommend that the board seek the involvement of legal counsel or who provide legal advice might find themselves the subject of a lawsuit for negligence if the warranty claims process unfolds badly and results in a high value claim being lost.

This is not to say that the property manager does not play a pivotal role in the entire process. The manager is key in supporting the entire effort and coordinating between the board, the engineers and counsel and in helping to move the claim forward. Perhaps even more important is the fact that the manager will help the board budget for a legal battle with the developer and rejuggle the financial plan where necessary so that the war chest doesn’t run dry at a critical juncture.

Finding costs savings is important too, and managers play an important part here as well. It is not strictly necessary for lawyers to have complete control over the construction deficiency claims process (especially the Tarion process) or be involved at every small step. In some situations, it is appropriate for the manager to step in to fill the void. Counsel should, however, be consulted early to help devise a workable strategy for the entire process and, subsequently, as and when needed throughout the process to keep the case on the rails. A close and effective working relationship between counsel and the property manager is essential to achieving a good result in any type of legal scenario.

Whether through the Tarion procedure or a lawsuit in court, pursuing claims for construction deficiencies is a process in which the condo directors, managers and owners invest substantial time, effort and money. The outcome of the process will play a large role in the condominium’s finances and its esthetic appearance and practical function for years to come. Embarking on the journey without the help of the corporation’s lawyer can put that investment at risk, cause delay and extra cost, and reduce the likelihood of a successful outcome. This, in turn, reflects poorly on the building and impacts the financial status and standing of the community. It may also demoralize the board, the manager and the owners alike and increase the chance of a dispute or conflict between those players. An unfavourable outcome of a long and hard-fought claim over construction deficiencies often gives rise to additional issues that distract everyone from the other important business that needs to be addressed in the condo’s early years. With so much at stake, responsible condo boards and property managers get their corporation’s lawyer involved before starting any warranty claim process.

[35]  The costs incurred by the applicant in the application were for the purpose of obtaining compliance with the Act. I would fix substantial indemnity costs at $18,000 inclusive of disbursements. The applicant is entitled, however, to full indemnity, which would entail a top-up to costs on a scale as between a solicitor and his own client. In cases where an unsuccessful party is required to pay full indemnity costs to the successful party, there is an inherent danger of "overlawyering" a matter with the knowledge that it is the other party who will have to pay. I do not suggest that overlawyering has happened here. The matter was very ably prepared and argued by counsel for the applicant. On the other hand, a condominium corporation's right to full indemnity is not a carte blanche and the issue is whether the totality of the applicant's legal expenses in relation to this matter is reasonable and therefore recoverable from the respondent. On that point, the court is not in a better position to assess the matter than an assessment officer. I am therefore referring to the assessment officer the issue of full indemnity costs to be assessed as between a solicitor and his own client. The parties are at liberty, however, to agree to the quantum of costs to avoid the additional expense of the assessment.

Three points worth mentioning arise from this passage.

The first point is trite but important for unit owners and their lawyers to know: Condo corporations are typically entitled to 100% costs recovery when they go to court to obtain a compliance order against a unit owner or occupant. The concept that innocent unit owners shouldn’t be subsidizing costs incurred to deal with a guilty party is set out in section 134(5) of the Condo Act, which has been positively enforced by our courts.

Second, a court may direct that the legal costs incurred by a condominium corporation in obtaining a compliance order be assessed by an assessment officer. This helps ensure that lawyers acting for condo corporations do their work efficiently and ensure that their fees are reasonable. It is important to note, however, that the concept of a condo lawyer’s bills being subject to assessment is not new, and costs awards of this sort should not be referred to assessment as a matter of routine. That said, the parties should work together to review the materials and reach an agreement on costs whenever possible, particularly if there is some question about certain dockets or disbursements.

On this second point, unit owners who think that they can secure a sharp reduction in the legal bill by assessing the bill should think twice. While an assessment officer will closely scrutinize the condo corporation’s legal bills, there generally won’t be a significant reduction in the bill unless the assessment officer finds that the work described in the bills was related to other files, or that the handling of the case was inefficient, grossly excessive or demonstrably unnecessary. Moreover, the cost of the assessment process will probably consume any potential reduction that the unit owner might achieve. Indeed, the unit owner is properly responsible for these costs and is likely just adding to his or her own burden by insisting on an assessment.

A third point is that the $18,000 in costs awarded by the court in this case seems to be in line with other recent decisions. Consider the case of MCC 39 v. Kreutzweiser, another enforcement case decided this spring, where a $19,000 costs award was given against an occupant who refused to remove cats from his condo unit after the board deemed the pets to be a nuisance.

Consider also the 2008 case of Italiano v. TSCC 1507, where a unit owner fought with the condo over whether that owner was making too much noise in his unit. After fighting the case through arbitration and appeals, the owner ended up being responsible to pay the condo’s $80,000 bill, plus his own costs. We described that case previously here.

We’ve said it before, but it is worthwhile saying it again: Unit owners who choose to mount a serious defence to court applications brought by their condominium corporations for compliance orders are gambling with their financial security.

Before coming to court with some vague notion of entitlement or “an issue of principle,” unit owners should think long and hard about whether that notion or principle is worth $15,000 or more out of their pocket, and consider the impact of that cost to them and their family.  There's no need to join the ranks of people who have bankrupted themselves fighting over a dog, etc., in a condo unit. 

Condominium unit owners facing a problem with their condo corporation should do themselves a favour and get legal advice from a specialist in condominium law as soon as possible. That small investment will probably save tens of thousands of dollars and help avert financial catastrophe.

Addition to common expenses 
134(5) If a corporation obtains an award of damages or costs in an order made against an owner or occupier of a unit, the damages or costs, together with any additional actual costs to the corporation in obtaining the order, shall be added to the common expenses for the unit and the corporation may specify a time for payment by the owner of the unit.  

In response to these arguments, the court made a further ruling on costs last week. Justice Low concluded that the offer to settle did not represent a significant offer of compromise that would justifying a greater degree of costs indemnity. More interesting, however, is the court’s ruling on section 134(5):

[10] I am not persuaded that s. 134(5) of the Condominium Act, 1998 applies in this case to require substantial or complete indemnity costs to be awarded to the defendant.

[11] This was a case brought by the plaintiffs for slander of title. It was not an application by the Condominium Corporation for an order enforcing compliance with any provision of the Condominium Act, the declaration, the by-laws, etc.

[12] Section 134(5) has to be read in the context of s. 134 as a whole. Accordingly, although the Condominium Corporation obtained a dismissal with costs, the order was not one which arose from an application to obtain an order to enforce compliance.

[13] In Metropolitan Toronto Condominium Corp. No. 1385 v. Skyline Executive Properties Inc., Doherty J.A. drew the distinction between costs of obtaining the order (which include defending the order obtained on appeal) and costs of enforcement. Costs of enforcement are not engaged by s. 134(5).

[14] In my view, the fact that the cause of action asserted by the plaintiff calls into question the correctness of the defendant’s earlier conduct in enforcing its rights by registration of a lien does not bring the proceeding within the terms of s. 134.

[15] For the foregoing reasons, I would not raise the level of indemnity from partial to substantial or full indemnity in favour of the defendant Condominium Corporation.

We agree with the court's ruling that section 134(5) applies only to applications for compliance orders under section 134(1). We wonder, however, whether the result might have been different had the court considered section 85(1) of the Condo Act, which provides:

Lien upon default
85. (1) If an owner defaults in the obligation to contribute to the common expenses, the corporation has a lien against the owner’s unit and its appurtenant common interest for the unpaid amount together with all interest owing and all reasonable legal costs and reasonable expenses incurred by the corporation in connection with the collection or attempted collection of the unpaid amount. [Emphasis added.]

It is also not clear whether the court might have ruled differently had it considered the typical indemnity clause contained in most condo declarations that require unit owners to make good for any loss or cost to the condo that results from an owner's act or omission.

Leaving these additional issues aside, we think that the court’s award of partial costs makes good sense here. Granting condominium corporations 100% legal cost recovery in all cases where unit owner plaintiffs are unsuccessful at trial would remove the important incentive to make a genuine effort to settle cases on a compromise basis at an early stage. The power of the court to award costs is intended to enforce the positive obligation on all parties to take positive steps to try and settle their cases. The award is an exercise of the court’s discretion to reward a party that made sincere efforts to settle a case and to penalize a party that did not.

While the court had previously found that the plaintiffs’ expectations about their rights were unrealistic in this case, it might also be said that the condo corporation’s expectations about the right to recover all of its legal costs were equally unrealistic.

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."

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.

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?   

[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.

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.

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?

#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.

It is difficult to predict the effects of the increased monetary limit in small claims proceedings, but there is a strong possibility that a greater number of litigants will bring claims. Condominium boards and managers should therefore be prepared for an increase in the number of claims made by unit owners, service providers and other condo stakeholders and know how to deal with them effectively. 

Because a defence must typically be filed within 20 days of being served with a claim, the manager should notify the corporation’s lawyers as soon as possible after being served with a claim, and have ready all information and documents relevant to the case. In cases covered by an insurance policy, written notice of claims should be given to the corporation’s insurer, and all claims should be disclosed on status certificates and referred to in the annual audit inquiry letters to the corporation’s lawyers.

Condominium corporations can also take advantage of the increased small claims limit to commence their own claims to recover money owing by unit owners and third parties. As always, they should get legal advice to help weigh the benefits and costs of legal proceedings in small claims court as compared to other available options. Often a stern letter seeking compliance or registering a lien against a unit owner is sufficient to obtain your objective.  Get legal advice before posting chargebacks, however, so as to minimize the chance of a claim for a wrongful lien -- These types of claims are becoming increasingly common.

It is also important to remember that lawsuits must be commenced within 2 years of the date the debt became payable or the date that damage occurred, after which time the right to sue is forever lost. As we described in an October 2008 entry (see here), what used to be a 6-year limitation period was reduced to 2 years in 2004.  

At the beginning of this decade, when the small claims court monetary limit had last increased (from $6,000 up to $10,000), the enabling regulation was made on November 22, 2000 and became effective on April 2, 2001, less than five months later.  In the absence of an explanation, there appears to be little reason behind the 12.5 month lead-up to implementing the increases announced this week. 

There is no doubt that some of the more complicated reforms will require time for the bar, bench and the courts to prepare, but the monetary increases could and should have been enacted separately from the other initiatives and made effective much sooner to maximize the benefit and to help relieve some of the burden on the courts and litigants now, or at least during 2009.

It may be true that these reforms will actually lead to lawsuits being resolved faster and more affordably as promised in this week’s news release, but we will be waiting until 2010 to find out for sure. They say that justice delayed is justice denied. The same might be partly true of justice reforms.