Toronto Standard Condominium Corporation No. 2095 v. West Harbour City (I) Residences Corp., 2014 ONCA 724
Decision Date: October 22, 2014
This is an appeal from the judgment of Justice Corbett dated September 23, 2013. West Harbour City is a developer, and TSCC 2095 is one of its developments. The condo’s board entered into an agreement with the developer which restricted the rights of owners to sue the builder for deficiencies that were beyond the amounts of the Tarion warranty. Now, the original board was controlled by the developer’s nominees. When control of the board was turned over to unit owners, they sued to set aside this agreement, arguing that no reasonable board of directors would have agreed to it. Justice Corbett declined to rescind the agreement, saying that a developer was entitled to limit its risk, and that the agreement had been disclosed to perspective buyers and also registered on title. In this judgment, the appeal court unanimously dismissed the appeal. They also stated that whether developers should be allowed to limit their liability in this way is a matter of policy for the legislature to decide, rather than for judicial determination.
Comment: One more reason to get legal advice when buying a condo. Provisions limiting developers’ liability can have financial impact, should a building turn out to have deficiencies.