In a news release yesterday entitled “Resolving Lawsuits Faster and More Affordably,” the Ontario Ministry of the Attorney General announced a number of notable changes to the civil justice system.  Most of these changes stem from the Civil Justice Reform Project chaired by the Honourable Coulter Osborne, who released a report of findings and recommendations in November 2007.

Among the reforms announced this week is an increase in the monetary limit of the Small Claims Court to $25,000 from the current level of $10,000 and a doubling of the monetary limit for the simplified procedure in Superior Court to $100,000 from the current $50,000. 

These increases become effective on January 1, 2010, more than a full year from now.

While these increases in the monetary limits are decidedly positive, the long delay until they become effective bears some comment.

Continue Reading Civil Justice Reform . . . eventually

I follow a large number of blogs to help expand my knowledge of the world, stay current with news and trends in my law practice and business, and enhance my skills as a lawyer, entrepreneur and human being. While there is no shortage of blogs out there, it is not always easy to find blogs that are on point or have the right focus to fit the bill.

Check out the Canadian Law Blog Awards ("the CLawBies").  Organized by Steve Matthews, a law firm consultant, law librarian and blogger, the CLawBies showcase some of the remarkable talent in the Canadian legal blogosphere each year. 

Nominations for this year’s CLawBies are being accepted from law bloggers.  Full details on how to participate are  here. 

I am delighted to add the following as my picks, in no particular order:

Continue Reading My nominations for 2008 CLawBies

Daily Commercial News reports on the swag being distributed by more than 1100 exhibitors at PM Expo and shares some of the sights and scenes of the show, which ends at 1 p.m. today.   Last call!

Dozens of seminars and workshops informed and educated hundreds of people over the past two days.   I was one of many  in attendance for the "Mould, Moisture and Related Building Envelope Failures" workshop given by Bruce Stewart and Phil Brearton of Pinchin Environmental.   A handful of their many excellent points included:

  • Municipalities are now required to inspect a building if notified by police that the building housed a marijuana grow-op (which are notorious for causing ruinous mould infestations);
  • In 2004, the Canadian Construction Association developed and published guidelines for dealing with mould in various stages and circumstances, including initial construction of buildings and in remediating subsequent infestations — worth being aware of;
  • A maintenance tip to help prevent water entering into a building:  Don’t make repairs overtop existing repairs.   While caulking over existing caulk might look nice and make us feel secure, it is an ineffective repair. 

Some additional information from Pinchin (thanks, Bruce!) on dealing with water damage and mould growth can be found here and the full PowerPoint presentation from the seminar is here.   Stay dry.

The 20th edition of the ever-expanding PM Expo show is on this week, starting today until Friday, at Metro Toronto Convention Centre.

From the organizers:

As Canada’s largest annual property management exposition and conference, the Show will facilitate the exchange of ideas, best practices, and product knowledge that will provide you with strategies and cost effective solutions for managing and operating your buildings.

Full details are here.

With dozens of workshops and seminars and over 1000 exhibitors showcasing new ideas and new products, there’s something for everyone.  

See you there.

Where a unit owner, tenant or a guest causes damage to an owner’s unit, section 105 of the Condominium Act, 1998 permits condo corporations to charge back certain repair costs by adding those costs as common expenses to that owner’s unit and collecting them by way of lien. Corporations can pass by-laws extending the circumstances under which they can charge back repair costs. The underlying concept is that an owner who is responsible for damage should pay any repair costs not covered by the corporation’s insurance.

This type of charge back is typically limited to the deductible amount under the corporation’s insurance policy, which can range from $500 to $10,000 for most water escape or fire claims. In larger condominiums or those with a poor claims history, the deductible can reach $50,000.

No matter what the amount, few owners can easily afford these charge backs. Thankfully, they can obtain insurance to significantly lessen the impact of such charge backs and protect their personal property and improvements to their unit, none of which are covered by the corporation’s insurance.

The problem is that a surprisingly large number of owners do not secure proper insurance because they do not understand the limitations of the corporation’s insurance and mistakenly assume that they don’t need to obtain their own coverage.  The truth emerges very quickly in the aftermath of a water escape or fire, but too late.   

Failure to obtain proper insurance can result in a crippling financial burden that can rob owners and their families of their financial security and their home. There are few things as heartbreaking or as avoidable.

Condo boards and managers should take concrete steps to help educate their unit owners about insurance on an ongoing basis and especially when new standard unit by-laws or insurance deductible by-laws are proposed.  Here are some ideas:

Continue Reading Educate owners about insurance today

By popular demand, a PDF version of the premiere edition of our Condo Alert! newsletter is now available for your online viewing pleasure.

Topics  include:

  • Trademarking your condo name
  • The new human rights regime
  • Clotheslines and clothestrees
  • GMA firm news

We also offer an answer to this age-old question: “How may lawyers does it take to stop traffic in downtown Toronto on a Friday afternoon?” See page 4.

Click here to view the newsletter now.

In a recent entry on the Toronto Neighbourhoods and Real Estate blog Move Smartly, lawyer Rachel Loizos offers some wise advice for prospective condo purchasers:   "Before you commit to purchasing a condo unit, make sure you have reviewed the rules."

She then lists the rules that most commonly affect purchasers and goes on to say:

The cost for non-compliance can be high as the condo corporation has the right to obtain a court order to force you to comply. You may also get stuck with their legal costs in the matter.

It is worth emphasizing that those legal costs can and often do reach the tens of thousands of dollars.   In the recent case of Italiano v. TSCC 1507 (summarized here), the condo successfully pursued a unit owner for violating the noise and nuisance provisions in the condo declaration and rules.  In the end, the at-fault unit owner was ordered to pay over $80,000 in legal costs to the condo corporation.   This was on top of what the owner had to pay his own lawyer.    Ouch!

Purchasers who don’t carefully examine the condominium declaration and rules before buying are taking an enormous risk.

The newly-transformed Art Gallery of Ontario opens its doors this weekend.   The Globe and Mail reports that the final ($276 million) product has met with the approval of its designer and world-famous architect, Frank Gehry, although he would make a few changes if more money was available.

At about this time a year ago, the famous architect and his firm were named as defendants in a lawsuit for alleged defects in a new building commissioned by the Massachusetts Institute of Technology.     The construction company was also sued and the accusations began to fly as to whether the defects were the result of the architecture or the construction. 

In responding to MIT’s lawsuit, Gehry told the New York Times that problems in complex buildings are inevitable, and that:

A building goes together with seven billion pieces of connective tissue. The chances of it getting done ever without something colliding or some misstep are small.

In commenting on that lawsuit and the parties’ response to it, lawyers at Stark & Stark in New Jersey made this observation in their Construction Litigation Law Blog:

It is disconcerting to see that a superstar architect, a global construction company and a world-class institute of higher learning, with $300 Million to spend cannot seem to create a water-tight building. Mr. Gehry seems to think that construction defects are par for the course. In that context, it comes as no surprise that we find problems with much simpler, mass-produced homes and condominiums.

The moral: First-year condo boards in a newly-constructed buildings should budget time and resources with the presumption that there will be defects and deficiencies that need to be addressed.  

Be sure to visit the AGO.

Condo managers and directors can find good news in the April 2008 Ontario Superior Court decision in MTCC 932 v. Lahrkamp, [2008] O.J. No. 3885.    This was a case brought by a condominium corporation against a “self-styled watchdog” unit owner who, while opposing lobby renovations, made repeated requests for records and then relentlessly pestered office staff when his requests were not filled as fully as he expected.

After finding that the owner’s conduct amounted to harassment, Justice Backhouse said:

The Condominium Act gives the respondent the right to examine the records of the corporation. He is not entitled to abuse that right by conducting a campaign by siege against the management office and directors. Banging on the management door on several occasions, blocking the door where the staff person was working and positioning his car to impede a director from proceeding are examples of conduct which are harassing. There are a number of remedies available to the respondent under the Condominium Act including calling a meeting of owners, removing directors and suing for oppression. Harassment is not one of them. When the respondent has been asked to desist by counsel, he has not done so. He has made it clear that short of a court order he will not stop his harassment. A staff person or director should not have to feel intimidated and harassed by the respondent.

Her Honour then granted an order: 

  1. Restraining the unit owner from communicating with any employee of the management office or member of the board of directors, other than in writing;
  2. Restraining the unit owner from entering or coming within 25 feet of the management office; and
  3. Establishing a special procedure for future requests for records by this owner, and namely that such requests be made in writing, that only one request be made per record, and that payment for copies be made in advance.

Update (May 5, 2009):   Items 1 and 2 of the above order were set aside on appeal in this case.   See 2009 ONCA 362.

The 12th Annual Condominium Conference, held this past Friday and Saturday in Markham, was a great success and very-well attended.   Congratulations to CCI-Toronto and ACMO!

Among the most anticipated regular features of this conference is the legal expert panel, with their bizarre stories from the trenches and headscratcher court cases.   This year’s panel, including our own Mark Arnold, did not disappoint us. 

Here are some of the cases highlighted by the panel this year:

Mancuso v. York Condominium Corp. No. 216, 2008 CanLII 20343 (ON S.C.)

Bulk cable TV costs can be treated as common expenses and recovered by way of a lien only where a by-law authorizes the board to supply such services and authorizes the cost  to be treated as common expenses.

Niagara North Condominium Corp. No. 125 v. Kinslow, 2007 CanLII 49188 (ON S.C.)

This case to enforce a "no pets" clause in a condo declaration was rendered by the same judge that decided 215 Glenridge Ave. Ltd. v. Waddington, 2005 CanLII 4197 (ON S.C.), where the court mixed up the hierarchy of declaration/by-laws/rules and consequently gave a perverse result that blurred the established caselaw for enforcement applications.   Having received better legal arguments in the Kinslow case, the court identified and applied the correct legal test and enforced the no-pets provision.   The highly-problematic Waddington case is now effectively expunged. 

Metropolitan Toronto Condominium Corp. No. 1143 v. Peng, 2008 CanLII 1951 (ON S.C.)

A unit owner’s failure to respond to demand letters or to mediation or arbitration proceedings in a rule enforcement case does not permit a corporation to proceed directly to court for a compliance order.   Mediation and arbitration must first be exhausted if available.  A similar case is York Region Condominium Corp. No. 890 v. 1185010 Ontario Inc., 2007 CanLII 44831 (ON S.C.).

Assal v. Halifax Condominium Corp. No. 4, [2007] N.S.H.R.B.I.D. No. 2 (NS H.R.B.)

Condo corporation seeks removal of satellite dish installed by unit owner on non-exclusive use common elements without authorization and contrary to by-laws.   Owner responds by making a human rights complaint, alleging that the satellite is necessary to provide religious and cultural education for the owner’s family, and that the restrictive by-law is discriminatory as to religion and and ethnic/national origin. The complaint was dismissed for lack of evidence of discrimination.

Italiano v. Toronto Standard Condominium Corp. No. 1507, 2008 CanLII 32322 (ON S.C.)

Confirms the power of arbitrators to award successful corporations their full indemnity costs for arbitration proceedings in rule enforcement cases and for corporations to recover such costs as common expenses. That power might be more limited, however, if the declaration and by-laws do not contain strong indemnity provisions.   Arbitrators may not award costs in respect of pre-arbitration proceedings such as mediation or the initial demands for compliance.