Condo Law Digest – November 2018

Branches on a rainy day.jpgPrecision Tree Care Ltd. v. Peel Condominium Corporation et al, 2018 ONSC 5755
Decision Date: September 28, 2018
http://canlii.ca/t/hvb98

This is a motion for security for costs made by the defendant, PCC 507, against Precision Tree Care. (In other words, PCC 507 is asking that Precision Tree Care be legally required to pay money into court to cover a possible future cost order, in the case that PCC 507 prevails in the legal dispute between them and is awarded costs.)

The original dispute is rooted in the cost of tree trimming services. In September 2017 Precision agreed to remove trees and perform other services at PCC 507 for a cost of about $12,000. In December, Precision invoiced PCC 507 for nearly $164,000. Precision argues that the work was a lot more involved than they realized at first as many of the trees were unsafe to climb and they had to bring in heavy equipment at considerable cost. PCC 507 argues that the extra work was not authorized by their property management company, and that an independent arborist they retained valued the work completed by Precision at about $2,000. (PCC 507’s property manager at the time is no longer employed by the company in question.)

In this action, PCC 507 argues that the burden is on Precision to establish that 1) their case has some merit; and 2) they are impecunious (and so an order for security would be unjust). Justice Lemon found “no dispute” that Precision lacks the assets to pay costs if unsuccessful. However he also found that Precision’s case was not “plainly devoid of merit,” as much would depend on the testimony of the former property manager. He dismissed the motion and declined to order security for costs.

Comment: It will be interesting to see if the parties can settle their dispute without coming back to court.

Barta v. Rudolph, 2018 ONSC 6208
Decision Date: October 17, 2018
http://canlii.ca/t/hvl93

This is an appeal of a Small Claims Court judgement. In August 2015 Mr. Rudolph signed a one-year lease agreement to rent Ms. Barta’s condominium unit starting November 1, 2015. Before signing the lease, Mr. Rudolph had several air quality tests done, as his daughter, who suffers from mold toxicity, planned to visit him and occasionally live in the unit. In October 2015 Mr. Rudolph presented Ms. Barta with a deficiency list of 13 items, all of which she addressed. In early November 2015 Mr. Rudolph gathered dust samples from the unit and sent them to a lab in the U.S.to perform an Environmental Relative Moldiness Index Report (ERMI), as his daughter’s specialist doctor in the U.S. had advised that she could not go into the unit without this test being performed. The test came back positive. Mr. Rudolph advised Ms. Barta that the unit was “not fit for human habitation” and that he would not be moving in.

At the trial, Ms. Barta testified that she called two or three private mold companies who told her that they had never heard of the ERMI test, and that they could do nothing if there was no visible indication of mold. She was unable to rent the unit and sold it in April 2016. Mr. Rudolph, for his part, agreed that he could have done the ERMI test before signing the lease, and that he would not have moved into the unit even if Ms. Barta had taken further steps to remediate the mold. The trial judge ordered Mr. Rudolph to pay Ms. Barta $20,688 for lost rent, costs, and interest.

Mr. Rudolph’s main argument for the appeal was that the trial judge did not apply the “fit for habitation” test. Justice Conway dismissed Mr. Rudolph’s appeal, saying it was clear from the trial judge’s reasons that he understood the test, even if he did not explicitly articulate it. Justice Conway ordered that Mr. Rudolph pay costs of $8500.

Comment: Sometimes I think that if people stopped throwing good money after bad, the appeal courts would have far less to do.

About the image: “Branches on a rainy night” by J.smithOwn work, CC BY-SA 3.0, Link

Condo Law Digest – October 2018

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Metropolitan Toronto Condominium Corporation No. 596 v. Best View Dining Ltd., 2018 ONSC 5058
Decision Date: September 4, 2018
http://canlii.ca/t/htssb

This is a motion in an on-going dispute between a commercial tenant and a mixed-use condominium corporation, stemming from noise complaints. In September 2017 MTCC No. 596 obtained an order requiring Best View Dining to abate the noise disturbing residential owners. The noise problems persisted, and in November 2017 MTCC No. 596 brought a contempt motion. Justice Perell became seized of the matter in April 2018. He put off consideration of the contempt motion, reserved the matter of costs, and made an interim order requiring more steps to address the noise problems. MTCC No. 596 alleges that they incurred close to $39,000 in legal fees and engineering costs between November 2017 and May 2018. They asked Best View Dining for reimbursement and informed them that if they didn’t pay, the amount would be added to their common expenses. Best View did not pay, and in July 2018 the corporation registered a lien.

In this motion, Best View Dining seeks an order from the court discharging the lien. They argue that the lien was premature, given that there had been no ruling on the contempt motion. Justice Perell found that the lien was proper and dismissed the motion. Best View’s “real objection,” he charged, was that MTCC No. 596 was “presumptuously writing itself a blank cheque” before the court could review the claim for costs. However if there was an overcharge, this could be resolved upon the return of the contempt motion. If the contempt motion never comes back, then the dispute over the amount of the lien could be resolved under the Mortgages Act.

Comment: Let’s hope, for everyone’s sake, that there is some technological solution to the noise problem.

Taft Management Inc. v Gentile, 2018 CanLII 82880 (ON SCSM)
Decision Date: August 27, 2018
http://canlii.ca/t/htth4

The defendant is the chairman of the board of TSCC No. 2003. Following a November 2016 board meeting he sent two emails to the rest of the board, raising concerns about the performance of the plaintiff, at that time the property manager of the condo. Taft somehow obtained copies of these emails, and found that they contained “false and damaging” statements. Taft brought a claim against Gentile, and in this motion, Gentile asks the court to dismiss the claim based on anti-SLAPP provisions.

(SLAPP is “strategic litigation against public participation.” The legislation is intended to encourage freedom of expression on matters of public interest.)

Justice Prattas dismissed the motion, saying that the matters discussed in the emails were “communications related to matters involving the everyday affairs at the Condo” and not in the public interest. The plaintiff’s claim can proceed to trial, and the parties will bear their own costs.

Comment: Mediation can be highly effective in disputes such as this, where feelings run high and the financial stakes are relatively low.

About the image: Monkey enjoying a quiet moment by Daisuke tashiro from Japan – snow monkey, CC BY-SA 2.0, Link

Conflict Resolution Lessons from my Karate Training

I’m training for a black belt in Shotokan karate. It’s true – and these challenging martial arts lessons are not only making me physically and mentally stronger, but also sharpening my skills as a professional mediator.

Did you know there are striking parallels between karate techniques and (non-violent) conflict resolution? I’ll explain briefly:

Part of our time each karate class is spent performing self defense drills with a partner. Each person takes turns being the aggressor and the defender. When defending yourself, the natural tendency is to try to get away from your aggressor.

Yet you can almost always defend yourself more effectively by getting closer.

This is how it works in conflict resolution too.

We tend to distance ourselves from people with whom we’re in conflict. This is a mistake. The closer we can get to our aggressors – in order to understand their viewpoint and position – the better poised we are to successfully defend ourselves against them — and ultimately end the conflict on our terms.

Here are some ways to do this – outside of karate class:

  1. Ask questions. In particular, ask the other person why the subject of your conflict matters to them.
  2. Listen more than you talk. And when you listen, really listen. Don’t just wait for your turn to talk.
  3. Repeat back what the other person says to be sure that you really understand what they’re saying. This will also let the other person know that you’re listening and help them feel understood.
  4. Try to understand their perspective. Do you find the other person’s position completely absurd? It makes sense to them. Find out why.

About the image: At my brown belt graduation with Shihan Ricky Bonaparte of Northern Karate.

Condo Law Digest – September 2018

Workers on suspended scaffold in Korolyov.jpg

Patterson v. York Condominium Corporation No. 70 and Myronyuk, 2018 ONSC 3735
Decision Date: August 8, 2018
http://canlii.ca/t/htcmw

Ms Patterson is the owner of a townhouse in YCC No. 70 and was a member of the Board from 2013 to January 2016. The corporation is older and in need of repair. In June 2016 an investigative audit advised doing some repairs and increasing the common expense payments by 14% to build up the reserve fund. After receiving the report the corporation changed property management companies and started working with a company that specializes in older condominiums. The new management company helped the Board to prepare a budget that more accurately reflected its costs. The Board did not proceed with the increase in fees.

Ms Patterson argues that the current board has not fulfilled its obligations under the Condominium Act, and that action is needed to secure the financial well-being and physical integrity of the condominium property. She also alleges “harassment” by Ms Myronyuk, a Board member since January 2016. Ms Patterson asks that Ms Myronyuk be removed from the Board, that YCC No. 70 increase the common expense fees, and that various repairs be undertaken. The Board argues that the problems of the condominium are well in hand, repairs are underway, and that the allegations against Ms Myronyuk are unfounded.

Justice Pollak dismissed the application, as he could find no evidence that the Board had not acted reasonably and in good faith, exercising the care and skill that a reasonably prudent person would exercise. No court intervention is required.

Comment: Justice Pollak remarked, “The former management company may have had an interest in influencing the recommendation in the report to prevent its termination.”

Arif v. Mwebi, 2018 ONSC 4982
Decision Date: August 20, 2018
http://canlii.ca/t/htmft

At the end of June 2018 the applicants entered into an Agreement of Purchase and Sale to buy a townhouse condominium from the respondent, Ms Mwebi. On July 11 there was an amendment to the Agreement, extending the time for the delivery of the status certificate, and giving the purchasers two days to waive the condition. If they did not waive the condition, the Agreement would become null and void. The applicants, after reviewing the status certificate, proposed a further condition on the Agreement, asking that Ms Mwebi clear all maintenance and common expense fees. She refused, took the position that the Agreement had been terminated, proposed to return the deposit, and re-listed the property. A few days later she resold the unit with a closing date of August 17, 2018. On August 13 the applicants were granted an ex parte (emergency) motion seeking a Certificate of Pending Litigation (which would effectively derail the new sale).

In this application, Ms Mwebi asked to have the CPL overturned so she could go ahead with the new sale. Justice Ricchetti granted the motion for the following reasons: 1) In their ex parte motion, the applicants failed to disclose that they had proposed an amendment to the Agreement of Purchase and Sale, which the vendor had rejected. 2) The property is one of many townhouses and therefore not unique. 3) The applicants did not bring the ex parte motion in a timely manner, but waited until the new sale was about to close, putting maximum pressure on Ms Mwebi. 4) There is a bona fide third party purchaser for the unit.

Comment: Costs of $4406 were granted to Ms Mwebi.

Condominium Authority Tribunal Decisions

From July 2018

Mara Bossio v. Metro Toronto Condominium Corporation 965, 2018 ONCAT 6 

MTCC 965 is not obliged to provide Ms Bossio with the 2016 President’s Report, nor with Board meeting minutes from 1997 to 2001, as these documents relate to “actual or contemplated” litigation regarding a dispute between Ms Bossio and the corporation over damage to her unit.

Janet Cangiano v. Metropolitan Toronto Condominium Corporation No. 962, 2018 ONCAT 7

MTCC 962 is not obliged to provide Ms Cangiano with “legible and unaltered” copies of proxy forms from the November 2017 Annual General Meeting.

About the image: Workers on a suspended scaffold (a swing stage) mount fasteners for a rainscreen in Korolyov, Russia. Photo by Dmitry Ivanov. – Own work, CC BY-SA 3.0, Link

Condo Law Digest – Mid-summer 2018

Verona - Juliet Balcony.jpg

Zenith Aluminum Systems Limited v. 2335945 Ontario Inc., 2018 ONSC 4199
Decision Date: July 11, 2018
http://canlii.ca/t/hsxlr

Zenith provides glazing and aluminum window/wall systems to construction projects. The respondent is a condominium developer and builder carrying on business as “Momentum.” In late 2013 the two companies began negotiations regarding a window wall system to be used in the construction of a condominium project. Zenith eventually quoted a price of nearly $3 million. The quote did not include any pricing or details of a balcony guardrail system for the project, as Zenith doesn’t do this kind of work. (Another company eventually provided a quotation for this part of the project). In August 2014 Momentum accepted Zenith’s quote. In May 2015 the defendant took the position that Zenith should provide the balcony guardrail system as well. They met to discuss the issue and agreed to go to arbitration, and also agreed on arbitration dates as well as on an arbitrator.However no Arbitration Agreement was ever signed.

In early 2017 the parties entered into a tolling agreement (that is, they agreed to waive the right to claim that litigation should be dismissed due to the statue of limitations running out.) In one of those unexpected twists, Zenith never received Momentum’s signed copy of the agreement, because the document was diverted to the “junk” folder of their email system. With no signed arbitration agreement, no tolling agreement, and the limitations period running down, Zenith issued a breach of trust claim. Momentum takes the position that there is no longer an arbitration agreement, and they would like to have the issues resolved in litigation.

Justice Brown ordered that the parties submit to arbitration, get it done by the end of the year, and each bear their own costs.

Comment: Is the moral of this story to always check your spam filter, or to pick up the phone if a document you’re expecting fails to arrive?

Peel Standard CC No. 984 v. 8645361 Canada Limited, 2018 ONSC 4339
Decision Date: July 13, 2018
http://canlii.ca/t/ht020

Justice Glustein has ordered the defendant, Mirza Ahmed, owner of a unit in “Westwood Mall” (PSCC No. 984, the applicant), to sell the unit and to vacate other units that he currently rents. The judge also granted PSCC 984’s motion of contempt of court against Mr. Ahmed for breaches of past court orders. Three prior court orders addressed Mr. Ahmed’s behaviour towards the condominium board and staff. Among other things, he had been forbidden from contacting, communicating, harassing, or coming within 25 feet of condominium personnel. Justice Glustein also denied Mr. Ahmed’s request for adjournment on medical grounds, saying that Mr. Ahmed had not provided adequate reasons why the hearing that had already been adjourned twice should be adjourned a third time.

Comment: PSCC 984 had requested about $40,000 in costs; the judge granted $25,000. Mr. Ahmed did not help his case by telling the judge in an earlier proceeding, “Of course I will not [pay] them.”

About the image: Juliet’s Balcony in Verona by Guilhem DulousOwn work, CC BY-SA 1.0, Link

I am a Scrum Master

Scrum all blacks midddlesex.jpg

Just a quick note to let everyone know that I am now a Certified Scrum Master.

(For those of you who don’t know … “Scrum” is a process for managing software development. It is part of the Agile methodologies. If you want to learn more, a good place to start is the Agile Manifesto).

A “scrum master” is a facilitator who works with a small software development team (the scrum team) to help with both the team’s internal dynamics, and the interactions between the team and various other stakeholders.

You might be wondering why I took this step, beside my geeky interest in creative group processes. Scrum is now very widely used, and I wanted to understand it better so that I could better serve my clients in the IT sector. With my Scrum Master training I have a good idea of the kinds of conflicts that can arise within a scrum team, the stumbling blocks they can encounter in wider organizations, and strategies for resolving both.

(If you’re interested in becoming certified yourself, or in transitioning an organization to Agile methodology, I can heartily recommend the folks at Berteig.)

About the image: A rugby scrum by Unknown – The Complete Rugby Footballer by D.Gallaher & W.J.Stead – 1906, Public Domain, Link

Condo Law Digest – June 2018

Simcoe SCC Nos. 431 & 434 v. Atkins, 2018 ONSC 3105
Decision Date: May 22, 2018
Link to text of decision

This is a dispute about some procedural issues related to a meeting of the owners of units in Simcoe SCC Nos. 431 & 434. The applicants argue that Mr. Atkins, a unit owner, has provided misleading information to other owners in the past, in attempts to discredit the current Boards of Directors. (By way of background, common expense charges for owners recently doubled, and the corporations are suing their developers in relation to first year budget statements.)

Everyone agrees that a meeting of the owners should be held. They disagree as to whether:

1) Owners may use proxies to vote;
2) The court should regulate Mr. Atkins’ communication with the owners before the meeting;
3) The court should make orders regulating the conduct of the meeting.

Justice Copeland ruled as follows:

1) While some of Mr. Atkins’ communications to owners were “unconstructive,” “mean-spirited,” and contained personal insults, this does not warrant preventing the use of proxies.
2) The corporations ask that, prior to the meeting, there be one (and only one) mailing sent to owners. It would enclose submissions from each side of the debate, and the content would be vetted by the lawyers for both parties. The reason given for this request was Mr. Atkins’ previous “misleading” communications with owners. Justice Copeland declined to make this order, saying it would be inconsistent with the democratic model laid out in the Condominium Act.
3) The parties have agreed that an independent person conduct the meeting, and they have even agreed who that person should be. Justice Copeland agreed to make an order for that individual to conduct the meeting, but declined to further manage the conduct of the meeting, leaving it to the chosen individual.

Comment: Justice Copeland closed with some stirring words on the importance of civil, open, and calm discussion in condominium communities, and an order for costs of $14,000 on a partial indemnity basis against Simcoe SCC Nos. 431 & 434. She declined to order costs against the directors personally.

About the image: By Ryan Somma from Occoquan, USA – Rally to Restore Sanity: What Do We Want? A Civil and Rationally Compelling Discussion of the Facts!, CC BY-SA 2.0, https://commons.wikimedia.org/w/index.php?curid=64269180

Condo Law Digest – May 2018

Wavy fence and a wall BW version.jpg

Omotayo v. Da Costa, 2018 ONSC 2187
Decision Date: March 29, 2018
http://canlii.ca/t/hrb84

The cases arises from a contentious board meeting of Metro Toronto Condominium Corporation No. 1292 in September 2011. Ms. Omotayo had recently been removed from her position as Chair and Mr. Da Costa had sent the Board a letter advising that he wished to resign as President. Nevertheless, both showed up at the meeting and began to argue with one another. Mr. Da Costa “lost it” (in his words) and struck Ms. Omotayo on the head with a chair. The police were called, and Mr. Da Costa was charged with three offenses. Ms. Omotayo made a claim against Mr. Da Costa and against MTCC 1292 for failing to protect her from the assault. Mr. Da Costa filed a cross-claim against MTCC 1292 for contribution and indemnity.

In this proceeding, MTCC 1292 has brought a claim for summary judgment to dismiss Ms. Omotayo’s claim. (Ms. Omotayo did not oppose the motion. She settled her claim with MTCC 1292 prior to this hearing. However Mr. Da Costa opposed the motion for summary judgment, and so the hearing went ahead.) Justice Nishikawa granted the motion for summary judgment, saying that MTCC No. 1292 did not breach a duty of care to Ms. Omotayo, as the corporation could reasonably expect board members to refrain from assaulting one another.

Comment: Costs of $6500 were payable by Mr. Da Costa to MTCC 1292. Here’s hoping that the current configuration of the Board manages to hold calmer meetings.

Toronto Standard Condominium Corporation No. 2256 v. Paluszkiewicz, 2018 ONSC 2329
Decision Date: April 12, 2018
http://canlii.ca/t/hrg2w

This is an appeal of an arbitration award. TSCC No. 2256 is a small condominium with four units. Mr. & Mrs. Paluszkiewicz were among the first owners. In October 2012 they delivered a renovation proposal with two preliminary drawings to the Board, and a month later they entered into a Section 98 Agreement to do the renovations. About one year later a new Board was convened. In March 2014 the Corporation notified the Paluszkiewiczs that their renovations did not comply with the Section 98 Agreement. Mediation failed, and in June 2015 the parties began arbitration.

The Paluszkiewiczs submitted that they had provided detailed construction drawings to the old Board in November 2012, and that the now-completed renovations matched these drawings. The Corporation argued that the meeting of Mr. Paluszkiewicz and the old Board to approve the drawings had not taken place. Gerry Caplan, the arbitrator, found in favour of the Paluszkiewiczs and ordered the Corporation to pay them $216,000 in costs.

In September 2017 the Corporation asked the arbitrator to set aside the award on the grounds that the Paluszkiewiczs had committed fraud. The Corporation produced a sworn affidavit from the old Board members stating that they did not discuss building plans with Mr. Paluszkiewicz. Mr. Caplan declined to set aside his award, and TSCC No. 2256 made this appeal. Justice Perell dismissed the application. Just because two parties have different memories of an event, he reasoned, it does not follow that one of the parties is lying or has committed fraud.

Comment: While no costs decision was issued for this appeal, that old warning against “throwing good money after bad” keeps running through my head.

Furr v. Duhamel, 2018 ONSC 1780
Decision Date: April 4, 2018
http://canlii.ca/t/hrbqm

This is a dispute between owners of a unit in “King’s Landing,” a townhouse development in Ottawa, and the Co-Tenancy Committee that manages shared property and expenses. (Just to be clear, the development is not a condominium corporation.) The main issue concerns the fence along the eastern boundary of the property. The applicants argue that the as-built fence and retaining wall are not included as shared property in the Co-Tenancy Agreement, and therefore maintenance of the fence is not a shared expense. In effect, by treating the fence as shared property, the Committee is favouring the owners whose property is adjacent to the fence (and who alone should bear the expense of repairing it.) They also allege bad faith on the part of the Committee. The Committee maintain that they have always acted in good faith and relied upon legal advice.

Justice Beaudoin found that the specific section of the Co-Tenancy Agreement that refers to the fence was ambiguous. However, reading the Agreement as a whole, together with other relevant documents, it is clear that the intention of the Agreement was for the fence to be treated as shared property. He also found the allegations of bad faith to be without merit.

Comment: Some passages of the decision indicate a long and acrimonious dispute. (“The Applicants declined offers to sit on the Committee and preferred to engage in a campaign against the Committee members that led the community to eventually vote for, and approve, policies on requests for information and against harassment.”) No decision yet on costs.

About the image: By W.carterOwn work, CC BY-SA 4.0, Link

Conflict Resolution Tip #1

conflict resolution tip 1

Last month, I was fortunate to spend some time in Shanghai.

One of the things I learned there is that “road rage” is virtually unknown.

I was told that, for a Chinese person to lose control in this way would be a humiliating loss of face.

Let’s keep in mind that our response to difficult situations is within our control.

About the image: Night on West Nanjing Road, Shanghai

Condo Law Digest – April 2018

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Sennek v. Carleton Condominium Corporation No. 116, 2018
Decision Date: March 22, 2018
http://canlii.ca/t/hr686

This is an involved costs decision regarding legal proceedings between Manorama Sennek and Carleton Condominium Corporation No. 116. Laurentian Bank Company, Ms Sennek’s mortgage holder, was granted intervenor status. The purpose of this hearing was to determine 1) the amount of costs owing by Ms Sennek; and 2) whether and to what extent the costs could be added to the common expenses of her unit and recoverable by lien. (This is important, because it would mean that the condominium corporation would have priority over the bank in recovering monies. The mortgage principal is about $141,000.)

Last year Ms Sennek was declared a Vexatious Litigant. The legal wrangling between her and CCC No. 16 started with small claims court actions over tree pruning, the size of the parking spot accompanying her unit, and a flowerbox she installed that did not comply with the condominium’s bylaws. The original lien, registered in 2015, was for the costs of removing the flowerbox – around $760. It was open to the Laurentian Bank to pay that amount (plus legal fees) to have the lien discharged. They chose not to do this. The litigation “spun wildly out of control” and CCC No. 116 had to spend a great deal of money to respond to the “voluminous” materials Ms Sennek submitted. In this decision, Justice Sheard discusses Bills of Costs for five different motions and hearings, in addition to the costs for the Vexatious Litigant application and the original small claims court hearing. Based on her analyses, she awarded costs of nearly $110,00 to CCC No. 116, with about $85,000 recoverable by lien under the Condominium Act.

Comment: The Laurentian Bank submits, “that it had no expectation or reason to fear that the costs related to the removal of a flower box could escalate to over $100,000.00.” Quite.

Lahrkamp v. Metropolitan Toronto Condominium Corporation No. 932
Decision Date: March 16, 2018
http://canlii.ca/t/hr1pm

This is another decision relating to costs. Mr. Lahrkamp sought leave to appeal the costs decision against him of just over $21,000. These costs arose in a small claims court matter that both parties agree was worth $1500. Mr. Lahrkamp argued that the Deputy Judge Prattas failed to consider the principle of proportionality in awarding costs. However Justice Sachs denied the appeal, saying that the Deputy Judge made very clear that Mr. Lahrkamp had behaved unreasonably during the proceedings, which entitled him to make an award exceeding the limits for costs in the Small Claims Court.

Comment: Earlier this year Mr. Lahrkamp was declared a Vexatious Litigant.

Brief Notice

Since beginning this blog, I have come across many decisions regarding Dewan v. Burdet – a complex case with many parties, stretching back over 20 years. I have always quailed at summarizing any of them. In what may (finally) be close to the end of the line, the Ontario Court of Appeal has dismissed an appeal against the order of Justice Kane, granted the “minority” owners leave to appeal the costs order, and allowed their cross-appeal on costs.

About the image: By MichaelFLOWERBOX REGENT’S CANAL, CC BY 2.0, Link