Noguera v. Muskoka Condominium Corporation No. 22, 2018 ONSC 7278
Decision Date: December 11, 2018
http://canlii.ca/t/hwj6w

The applicants, Mr. and Mrs. Noguera, have owned unit 210 of MCC No. 22 since 2014. In 2016 their next-door neighbor Mr. Mitchell informed them that he planned to sell his unit. The Nogueras proposed to the Board that they create an opening between the two units. If the proposal was approved, they would make an offer to purchase unit 211. The Board considered the proposal in March 2016. Both Mr. Noguera and Mr. Mitchell were Board members at the time. Mr. Mitchell indicated that he had a conflict of interest and left the meeting while the proposal was discussed. Mr. Noguera remained for the discussion of the proposal but did not vote on it. He did not feel he had a conflict under the Condominium Act and no one present indicated otherwise. The Board voted to approve the proposal, subject to certain conditions. The written resolution did not include a Section 98 agreement, (that’s the agreement, required by law, that an owner makes with the board before making changes to the common elements.) Previous owners who had made structural changes were similarly not asked to sign Section 98 agreements.

The Nogueras purchased unit 211 and began renovations. Somehow, starting in 2017, relations between the Nogueras and others began to sour. Among other things, the new President of the Board told the Nogueras that they were forbidden from using the lakeside path, based on unproven allegations that they had been looking into the windows of other units. In November 2018 the Board discussed whether the Nogueras should stop renovations until they signed a Section 98 agreement. The Nogueras indicated that they were willing to sign the agreement but not to stop renovations. (Further conflict: A couple of Board meetings held without proper notice to Mr. Noguera, still a Board member; a “heavy-handed” letter to the Nogueras from the Corporation’s lawyer; the President of the Board telling other unit owners that Mr. Noguera was “evil;” secret audiotaping of a Board meeting.)

Justice Matheson had to decide:

1) Was there a quorum at the March 2016 meeting when the Nogueras proposal was discussed?
Answer: Yes. Mr. Noguera did not have a conflict of interest and so his presence counts toward the quorum.

2) Was approval given for one or two openings between units 210 and 211?
Answer: The Board didn’t specifically discuss this question, but they later approved plans that indicated two openings.

3) What about the Section 98 agreement?
Answer: The Nogueras must sign one, but the one proposed by the Board is too broad.

4) How to deal with the other elements of the conflict?
Answer: The Condominium wrongly disparaged the Nogueras and must pay them $10,000 in damages. The Nogueras may use the lakeside path again.

Comment: A wise person once said, “If you don’t like rules, don’t buy a condominium.” I would like to add, “If you can’t set aside personal enmity, don’t become a condominium director.”

About the image: A forest creek in Muskoka by Michael J. Bennett – Own work, CC BY-SA 3.0, Link

1589680 Ontario Inc. v. TSCC 1441, 2018 ONSC 6941
Decision Date: November 21, 2018
http://canlii.ca/t/hw5wj

The plaintiff rents commercial space in TSCC 1441, a downtown condominium. The parties have been in litigation for several years over the use of common elements. In May 2018 the parties met with Justice LeMay in a pre-trial conference that lasted two days. They (apparently) resolved their dispute, and created Minutes of Settlement. However the parties did not sign any releases, as they disagreed as to what should and should not be included in the releases. In this action, the plaintiff is seeking an order making the Minutes of Settlement a Court Order. TSCC 1441 opposes, saying that to do so would be inconsistent with the intentions of the parties when they settled the matter.

Based on his interpretation of the Minutes, Justice LeMay declined to make them a stand-alone Court Order. He dismissed the action without costs.

Comment: Truly a mediator’s nightmare: “The parties started to disagree with each other about the terms and obligations under these minutes almost from the moment that they were signed.”

Brief Notices

In Precision Tree Care Ltd. v. Peel Condominium Corporation 507 (which I summarized last month) Justice Lemon has ordered costs of $10,000 to be paid by PCC 507.

The decision in C.M. Callow Inc. v. Tammy Zollinger et al. (which I summarized in January 2018) has been reversed by the Appeal Court. You may remember that the issue at stake had to do with the termination of a snow removal contract. The trial judge erred by “improperly expanding the duty of honest performance in a manner that went beyond the terms of the winter contract” and also erred in calculating damages.

About the image: “Discussing the War in a Paris Cafe” by Fred Barnard – Illustrated London News, Public Domain, Link

Precision 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.smith – Own work, CC BY-SA 3.0, Link

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

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

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 Dulous – Own work, CC BY-SA 1.0, Link

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