In our Spring 2023 Issue of Condo Alert! we look at the CAT’s recent decisions refusing access to records. The often used “litigation exemption” is examined in the context of a longstanding and far reaching dispute between an owner and condo. We also discuss the occasional “director’s request” for records – where an individual director asks to see records an owner would usually be exempt from examining.
Last month, we blogged about the importance of having clear and concise governing documents. A recent CAT decision highlights the value of communicating rules to residents and how poor communication might lead to unnecessary disputes.
In this case, the CAT dismissed a dispute relating to the “communication of rules” because it had no jurisdiction over the applicant’s complaints of confusing parking signs. The complaint did not relate to provisions within the governing documents that govern parking. The CAT described the condo’s parking signs as communicating the rules poorly, but determined that “changing, altering, even remove the parking signs will not alter the rules governing parking” and didn’t bring the dispute within the CAT’s jurisdiction.
This decision is a further reminder that messages to residents about the condo’s governing documents and how they are implemented should be transparent and straightforward. Supplementary or informal announcements about the rules such as signs at the property, notices and even enforcement letters should convey the rules consistently and simply so there’s no confusion.
The Condominium Authority Tribunal (“CAT”) and Superior Court operate on virtual platforms, with CAT hearings typically concluding via written argument. These forums have their own rules and directions and, occasionally, comments from adjudicators to guide process. This decision from the Superior Court comments on using written materials efficiently and to win in modern practice.
Gone are the days of “bullshit baffles brains.” Writing is expected to be clear, concise and simple. A client’s expectation of their lawyer in litigation should be that they will advocate in a focused way. Time and money should be spent considering that 95% of disputes will resolve versus filing materials to paper the trial of the century.
But the lawyer’s job also starts with the client’s material. A recent CAT decision described the disputed rules in that case as: “unhelpful, outdated, and difficult to enforce fairly and consistently.” The CAT strongly recommended that the condo undertake a review of its rules and either amend them or create more suitable ones.
In that vein, boards and managers (and drafting condo lawyers) need to consider ways they can improve at the source. Take a look at governing documents and see whether they are easy to understand and enforce. Demand letters should be straightforward so that owners and adjudicators can understand them. Set yourself up for success in compliance or enforcement, whether voluntary or ordered by the CAT or court, by keeping it simple.
Before CAT, condominiums typically brought compliance applications under s. 134 of the Condo Act to force unwilling residents to comply with the Condo Act and the condo’s declaration, by-laws and rules. And beyond ordering compliance with the Condo Act, declaration, by-laws and rules, judges have the broad discretion to “grant such other relief as is fair and equitable in the circumstances”. Notably, a judge (and not the CAT) can order a resident be permanently removed from the condo in extreme circumstances. This is what a Toronto condo sought in Toronto Condominium Corp. No. 1445 v. Catalli. Despite this broad discretion, the Catalli decision is a reminder on just how exceptional and difficult it is to remove someone on a compliance application.
The condo alleged that the Mr. Catalli had “a history of dangerous behaviour” and specifically referred to a lone incident where a fire broke out from his unit and caused extensive damage. Mr. Catalli was apparently criminally charged with arson by negligence, which he pleaded guilty to. Mr. Catalli argued that the fire was caused by faulty wiring – supported by a letter from an electrical contractor – and that he received no notice of his behavioural issues before this fire, save for one noise complaint for playing loud music. Interestingly, the condo seemed to indicate that any issues with Mr. Catalli’s conduct resulted from medical issues and not behavioural ones; Mr. Catalli showed he was receiving ongoing treatment and was on stabilizing medication.
The court refused the condo’s application to remove Mr. Catalli from the premises. First, the court was not convinced that Mr. Catalli would be an ongoing source of harm: the only evidence the condo pointed to was the fire which the court believed was an issue of faulty wiring rather than Mr. Catalli’s conduct. Second, the court acknowledged that Mr. Catalli is managing his medical issue and that it was “reluctant to stigmatize him for his past mental health problems”.
Forcing an owner to sell their unit or a resident to permanently move out has been considered by the courts to be the “ultimate and harshest remedy available…it should be reserved for the most egregious cases”. Such orders have only been awarded where the owner/resident is “incorrigible and unmanageable,” has been “given opportunities to reform their ways but exhibits an unwillingness to change” and “persistently refuses to abide by the community’s rules in extreme ways”. The judge in Catalli did not believe Mr. Catalli’s behaviour met this high bar.
This is an interesting decision that unfortunately doesn’t give us as much factual context as we would have liked. Still, here are Tony’s Takeaways:
“Ongoing Conduct”: the Catalli decision made an interesting point in addressing the condo’s safety concerns with Mr. Catalli: the judge held that this concern “must be based on evidence of ongoing conduct, not past conduct alone”. I understand the rationale and agree with how it was applied in Catalli.
However, I am concerned this decision minimizes the gravity of past conduct and overemphasizes “ongoing conduct”. This does not adequately consider the nature or severity of past incidents. For example, a violent resident could assault others in the condo but in the time it takes the condo to commence its compliance application and be heard by the courts, the resident has been in jail for most of this period and has assaulted no one on their return. On the plain text of this decision, the court would not order the residents removal.
But let’s say that after the application is concluded, the resident in my hypothetical assaults someone again, and the condo succeeds on its “second kick at the can” in removing the resident via another compliance application. Sure, the resident and their threats are now gone but at what expense? In answering this rhetorical question, another person has been assaulted and the condo has spent a lot of time, money and stress dealing with the violent resident. There needs to be greater emphasis on the nature/severity of the conduct – otherwise, precarious situations could be ticking time-bombs instead of a manageable risk with a clear solution.
Improve Record-Keeping: Keeping an incident log in a unit file is crucial for record-keeping. But an incident log is only as valuable as the quality of the incident reports. Any time there is an issue with an owner/resident, a note/report/summary of the incident needs to be prepared. These notes/reports/summaries should be detailed, objective and prepared as soon as possible while memory and recollection are at their best.
Be Reasonable: It’s trite to mention this in any condo-related commentary, but we constantly see the need to reemphasize this. While we wish the Catalli decision provided more insight into Mr. Catalli’s “history of dangerous behaviour”, it suggests that the best card the condo could lead with was this fire incident. Fires are undoubtedly serious situations that demand immediate attention but in this context, on the evidence we can glean from the decision and with Mr. Catalli demonstrating he did not contribute to the fire and that he addressed his medical issues, Mr. Catalli’s “dangerous behaviour” seems like a flash in the pan; a full-blown compliance application to remove him is disproportionate and unnecessary.
Although the CAT’s jurisdiction has been expanded since its inception, the CAT’s decision in Brady v. PCC 947 is a reminder that disputes outside section 117(2) of the Condo Act will likely be dismissed even though owner-applicants have succeeded in other forums.
A unit owner brought a CAT application against the condo corporation for banging noise from plumbing in the building. The owner claimed that the noise was negatively affecting the peaceful enjoyment of her unit. The condo investigated and made repairs, but the owner reported that the noise continued. The owner alleged that there was a construction deficiency with the plumbing. The owner pointed to provisions in the condo’s by-laws relating to the condo’s duty to maintain common elements and the declaration, which prohibited noise and nuisance in any unit to another.
The CAT determined that the issues raised in the application were beyond the jurisdiction of the Tribunal under section 117(2) of the Condo Act, which prohibits unreasonable noise from one unit to another. The evidence in this application highlighted that the noise complained of may have resulted from a construction, maintenance, or repair problem under sections 89 and 90 of the Condo Act.
The CAT was sympathetic to the owner’s circumstances but could not grant any relief as the complaint was outside of its jurisdiction. The application was dismissed.
We start the 11th volume of our newsletter, Condo Alert!, Winter 2022, with our annual Top 10 condo cases review.
The CAT expanded its jurisdiction on January 1, 2022 to include noise and nuisance cases, and with that 2022 saw an influx on CAT decisions on wide ranging matters, from pets to nuisance to what did or did not fall within its jurisdiction. We also saw the return of the damages award for oppression and a reinforcement of stays being ordered when parties attempted to by-pass mandatory mediation and arbitration.
We are thrilled to see our readership continue to grow this year. We wish you all health and happiness in 2023!
All the best in the new year,
The lien regime to collect arrears against a defaulting unit owner is straightforward and codified in the Condo Act and common law – there’s a default in common expense payment, a lien arises automatically, a certificate of lien is registered against title to the defaulting unit and then enforcement may take place in the same manner as a mortgage. That culminates in selling the unit via notice of sale if collection is otherwise unsuccessful. This process works because there are avenues to collect and enforce even if the owner flat out ignores the condo’s efforts. So long as the proper notices are given, the condo can proceed absent an owner.
But what can condos do when other condos are in arrears of shared costs and ignore communication and collection?
A recent CAT decision considered whether a condo’s claim for indemnification for legal costs in issuing a compliance letter was reasonable and whether the owner was required pay it.
The condo issued a compliance letter to the owner citing multiple incidents of noise, nuisance and harassment and demanded the owner reimburse the condo for the cost of the letter. The owner requested the security incident reports that allegedly supported the compliance letter but paid the condo’s requested costs after receiving a second notice of intent to lien. The owner challenged the chargeback and argued that the action taken by the condo in sending the letter without any warning was unreasonable and so were the costs.
Being a condominium director is often a thankless job: most condominium directors in Ontario serve on an unpaid volunteer basis to deal with big-ticket items such the corporation’s finances, maintenance and repair and rule enforcement all while inevitably making themselves a target for unhappy owners. Generally speaking, the Condo Act and a condominium’s by-laws requirements to run for the board are fairly easy to meet. The beauty of this is that condominium boards are typically made up of different backgrounds, experiences and expertise. There is a place for all types of owners on a condominium board but by the same token, it raises questions as to whether directors are qualified to serve on the board: are they the right person for the job or did they simply win a popularity contest?
To address this issue and instill a basic level of condominium knowledge for all condo directors, the Condominium Authority of Ontario provides a basic Foundational Director Training program (the “FDT”). The program provides a high-level overview on crucial topics like condominium governance, financial management and maintenance/repair. The program is offered for free and can be done online. This program is mandatory for all condo directors: per the Condo Act, directors who do not complete this mandatory training within six months of their election/appointment to the board are automatically disqualified from their position.
In 2022, the CAO launched its Advanced Director Training (the “ADT”). The ADT comprises six modules on Condominium Governance, Emergency Planning & Preparedness, Finance, Issues Management, Overseeing Condominium Managers and Procurement. These modules explore issues not fully addressed in the FDT such as managing difficult conflicts within the board, effective oversight of condominium managers and how to manage the bidding/tendering process for major construction contracts. To help directors navigate the ADT, the CAO offered an informative live webinar (which is available at https://www.condoauthorityontario.ca/news-media/advanced-director-training-webinar/) and if that wasn’t enough, the CAO provides comprehensive Best Practice guides on each module (https://www.condoauthorityontario.ca/director-training/director-training-overview/advanced-optional-director-training/).
As someone who regularly deals with condominium matters, I am thoroughly impressed with the CAO’s training programs. Of course, there’s always room for improvement. For starters, most directors I have spoken to are unaware of the ADT though I appreciate that the program is still in its infancy. Secondly, there are important topics (namely proactive issue spotting and enforcement) that should be incorporated into the mandatory FDT with the rest of the ADT serving as a supplement to the FDT.
We will have to wait to see how effective the ADT is but the potential is certainly there. As a parting remark, Tony’s Takeaway is that all directors who haven’t completed their FDT yet do so immediately; and for those who have completed the FDT, consider the ADT and the wonderful resources the CAO provides.
In the 2022 Condo Conference Issue of our newsletter, we hash out our office debate on whether Stan, the Akita, should stay or go and recap some best practices in leasing common elements. Thanks to the CAT for this issue’s content!
We are proud to sponsor and present at this year’s Condo Conference, taking place Friday, September 30 and Saturday, October 1, 2022. If you haven’t registered, there’s still time! It’s always an excellent event!