Condo Law Digest – June 2019

Reddy v. 1945086 Ontario Inc., 2019 ONSC 2554
Decision Date: April 29, 2019

The applicants are 605 people who entered into Agreements of Purchase and Sale with the defendants in 2016 to purchase units in the as-yet unbuilt Cosmos Towers. The Agreements contained a provision permitting certain types of early termination of the contracts. (These provisions are required by law.) One permitted reason for termination of the contract is the failure of the vendor to secure financing on satisfactory terms. The vendor must agree to “take all commercially reasonable steps within its power” to satisfy the early termination conditions. The Agreements also contained a Proviso that the vendor has the sole and absolute discretion regarding termination conditions. In 2018 the defendants informed the applicants that the Cosmos Towers projects had been cancelled because they couldn’t secure funding. All of the deposits made by the purchasers were refunded.

Justice Penny noted that the reasonableness and good faith of the defendants with regard to securing satisfactory financing were not in question. The applicants argue that 1) the defendants had no right to claim for themselves absolute discretion over the termination conditions in the Proviso; 2) that the termination was therefore a breach of contract; and 3) that they are entitled to damages. Justice Penny provided a number of arguments for why the correct interpretation of the Proviso was that the vendor did in fact have the right to terminate the project if they could not secure funding despite having taken all reasonable efforts. Therefore the termination was not a breach of contract and the applicants are not entitled to damages.

Comment: Justice Penny noted that such early termination conditions protect purchasers from being involved in projects that are insufficiently funded and at risk of failure.

About the image: Photo by Markus Schriebl.

Condo Law Digest – May 2019

AMA Velas Manabi 2014 (6) (13936403767).jpgTall Ships Landing Developments v. Leeds Standard Condominium Co. No. 41, 2019 ONSC 2600
Decision Date: April 25, 2019

This action is one installment in a complex dispute involving a developer, a condominium complex (LSCC No. 41), a property management company, and one of the condominium directors. At the heart of this particular dispute is a Shared Facilities Agreement. The issue that inspired this action seems to have been resolved: it was a dispute over the process by which a new shared facilities manager was chosen.

The respondents argued that the present application should not be heard on its merits because it overlaps with an action before the courts in Toronto, and because the applicant did not comply with the dispute resolution process set out in the Shared Facilities Agreement. They asked Justice Mew to strike the application in its entirety. The applicant argued that the Toronto action does not involve identical parties.

Justice Mew concluded that the application should be stayed on the grounds that the applicant and LSCC No. 41 are bound by the dispute resolution process set out in their Agreement. Depending on the outcome of that process, the claims against the other respondents (the property management company and the director) may or may not be sustainable and worth continuing.

Comment: Justice Mew advised the parties that if negotiation and mediation fail, the parties can obtain resolution of some of the issues through arbitration. If there are still issues to be resolved after the ADR process is exhausted, then he will remain seized of the matter.

Weinstein v. HMQ, 2019 ONSC 2133
Decision Date: April 4, 2019

In this action, Mr. Weinstein claims against a number of government ministries, Humber College, the YMCA, and the Condominium Regulatory Authority of Ontario. Mr. Weinstein, who was not represented in court, took a skills training course to be a condominium manager. However he is not currently eligible for a condo manager license because he does not have two years’ work experience. The defendants have brought a joint motion to strike the Statement of Claim.

While sympathetic to the plaintiff and to the difficulty of navigating the legal process without a lawyer, Justice Nakatsuru found that the Statement of Claim contained no material facts and did not comply with the law. He ordered it struck, but granted Mr. Weinstein leave to amend the claim and correct its deficiencies. He also granted costs of $500 each to two of the defendants.

Comment: The defendants had argued that Mr. Weinstein should not be granted leave to amend, as it was “plain and obvious” he had no reasonable causes of action. However Judge Nakatsuru found that this would not be right, fair, or in accordance with the law.

Brief Notices:

In Sajadi v. MTCC 648 the Human Rights Tribunal of Ontario has dismissed Ms Sajadi’s claim of discrimination on the basis of place of origin and family status. Ms Sajadi was accused of running a daycare business out of her unit, which is prohibited under the Declaration. She alleged that the corporation discriminated against her because they did not make similar accusations against others who were also running businesses from their units. In April 2017 an arbitrator dismissed her claims of discrimination and found in favour of the corporation. In this action the adjudicator for the HRTO dismissed Ms Sajadi’s application on the grounds that the arbitrator had already addressed her claim of discrimination.

An appeal has been denied in Patterson v. York Condominium Corporation No. 70. (This case was summarized in the May 2018 edition of the Condo Law Digest.)

About the image: By – Flickr, CC BY-SA 2.0, Link

Family Conferences: The Antidote to Family Cottage Conflict

Green shutters (238474420).jpg

It is one of the “dirty secrets” of the short Canadian summer that the family cottage can be a source of hard feelings, stress, and conflict. I once met a woman who told me that drama over her ex-husband’s family cottage was a big factor in their eventual divorce. While this is an extreme outcome, I wonder how many similar stories are out there?

Whether the property in question is modest or luxurious, rustic or well-equipped, issues such as who gets to use it and when can drive a wedge between family members. This is because a cottage is a valued piece of real estate (with all of the responsibilities this entails), but at the same time it is more than a real estate asset. It is a repository of childhood memories and family traditions. Discussions of practical issues (when to open and close the cottage, ongoing maintenance, even changes to the décor) arouse strong emotions when they are mixed up with family dynamics and alternative versions of a common history.

A family conference is one way to put to rest ongoing conflict over a shared vacation property. Everyone who has some kind of claim on the cottage sits down together and works out a shared plan. Issues to be resolved might include scheduling, how expenses are covered, cleaning and landscaping, will the cottage be rented to non-family members, and if so, who will manage that. You might also talk about basic expectations around tidiness and supplies.

Follow these guidelines to make the most of your family conference:

Be clear on your objectives. Are you making decisions for this season only, or coming up with a plan for the next five years?

Draft an agenda. What issues are on the table, and in what order are you going to go through them?

Make a commitment to hearing one another out. Everyone should have the opportunity to speak, and everyone should feel like their viewpoint has been heard.

Use video if someone can’t be there in person. Skype, Zoom, and Google Hangouts are great ways of meeting together when you can’t be physically in the same room.

Have the full information on hand. As much as you can, discuss real numbers and timelines. Bring the documents related to insurance, past maintenance costs, etc. If changes to the ownership structure are on the table, have someone meet with an accountant or financial planner and report back to the group on tax and other implications. Avoid discussions around “possible” consequences.

Decide how you will decide. Are you aiming for unanimous agreement? Majority vote? Coin tosses for low-stakes decisions? Most people understand that they won’t get their way on every decision. But if it seems like decisions are constantly going against one person, that will likely be a barrier to long-term resolution.

Don’t restrict attendance. Sometimes people want to exclude spouses and partners from a family meeting. This is usually a bad idea. In most long-term relationships, people are making shared decisions and want their partner to be on board. If a partner is excluded, then he or she may not understand the reasons behind key decisions. You might think that everyone is in agreement, only to have someone go back on a decision after discussing with their partner.

Get it in writing. Memories are faulty, and it is easy to overlook important details if they aren’t written down.

Consider working with a professional. Afraid that cousin John will dominate the meeting? Concerned that tensions are already high? Consider working with an experienced mediator or facilitator who will know how to manage difficult personalities and strong emotions.

Summer is short, and vacation time is precious. Don’t let conflict over a vacation property compromise your enjoyment.

About the images: First photo by Jennifer Aitkens from Guelph, Ontario, Canada – Green Shutters, CC BY 2.0, Link Second photo by Altius Architecture – Jonathan Savoie –, CC BY 2.0, Link

Signs of Workplace Conflict

Catching conflict early is a key part of resolving it effectively. All too often I get calls saying, “this came out of nowhere.” But when I dig a little deeper, I find that there were ample warning signs and indicators that managers and supervisors failed to notice. Don’t let that happen to your organization.

Here are a few warning signs of growing conflict.

• A high rate of absenteeism, stress leaves, sick leaves

• More people than usual asking to work from home. This might indicate people avoiding the workplace for emotional reasons.

• Negative gossip. There will be some workplace chatter in any organization. That’s not necessarily a bad thing. But if it gets to be overwhelming you should be alerted that something is wrong.

• People working through backchannels. Perhaps they need information from a co-worker or another department. But instead of asking directly, they go through an intermediary. If people consistently avoid dealing with a particular individual or department, you should definitely investigate.

• Using outside suppliers where there are internal resources. Again, any actions that shows employees going through some kind of subterfuge in order to avoid others is a warning sign.

• Meetings where no one talks. Surface harmony may mask deeper conflicts or indicate that people are afraid to speak up. Whatever the reason, too much silence should sound as a big warning bell.

If you notice one or two of these, it probably isn’t a big deal. If you notice three or more, however, it is worth investigating.

About the images: 1) By Christina Morillo; 2) By Mary Whitney. Both courtesy Pexels.

What Conflict Is and How it Escalates

Managing conflict is a crucial skill set for leaders today. To do this effectively, you need some understand of what conflict is and how it escalates.

I understand conflict as disagreement or competition plus mutual hostility. When friends disagree – even about important matters – it doesn’t usually turn into conflict because they have a foundation of mutual affection. People who play on opposing sports teams may compete very fiercely, but it doesn’t become a conflict unless they dislike each other for some other reasons.

Where does “mutual hostility” come from? From what I have seen in workplaces, it often arises from a perception of disrespect or a sense of unfairness. For example, someone sees their colleague get promoted while they don’t, or it becomes apparent to everyone that one person is receiving special treatment from the boss. Whatever the source, a perception of unfairness is a huge driver of workplace conflict.

Any organization is going to include some people who get along with each other better than others, and every workplace is going to have ups and downs. Usually these day-to-day disagreements don’t amount to much. Then one day there is a more serious incident. It doesn’t really matter what it is, and I have seen a very wide range of small incidents that end up blown out of all proportion because of the way they are managed.

Typically after the incident someone – most often a supervisor – will step in to smooth things over. If this person has the right skills and is respected by everyone involved, then things will go back to where they were before – small ups and downs without genuine conflict.

Yet all too often the intervention fails.

Maybe the attempted mediator lacks the proper skills or is seen as biased. For whatever reason people involved in the conflict don’t feel heard or understood. The failed intervention leads to a dramatic increase in stress. If this continues, or if other “small” incidents are mismanaged, then communication breaks down, work no longer gets done, and the organization is weaker.

When conflict escalates and is allowed to go on without a resolution it can become distracting and costly to an organization. The longer conflict goes on, the graver the consequences. Most people don’t like drama at work. An organization may lose its best people, as good workers usually have other options.

Next time: Warning signs of workplace conflict

About the images: 1)Photo by Tim Gouw on Unsplash 2) Courtesy of







Condo Law Digest – April 2019

Nilgais fighting, Lakeshwari, Gwalior district, India.jpg

Swan v. Durham Condominium Corporation No. 45, 2019 ONSC 1567
Decision Date: March 8, 2019

Mr. Swan owns a unit in DCC No. 45. He served as a Board Member for about 4 months in 2009 before being removed by a vote of the unit owners. After his removal from the Board, Mr. Swan initiated five proceedings against the Corporation in Small Claims Court. These were all dismissed, as was his appeal. In May 2010 DCC No. 45 commenced a court application against Mr. Swan, asking 1) that he be required to remove a satellite dish from his unit; 2) a declaration that he had breached the standard of care for a Director; and 3) that he be declared a vexatious litigant. Mr. Swan brought a cross-application to be reinstated as a Director, and seeking a declaration that the Corporation had treated him oppressively. In June 2012 Justice Sosna found that Mr. Swan had indeed breached the standard of care for a director, declined to have him declared a vexatious litigant, and awarded costs of $45,000 to DCC No. 45. (The satellite dish had already been taken down by that point.)

In February 2013 DCC No. 45 gave Mr. Swan notice that it would be registering a lien on his unit for nearly $219,000. In a letter of August 2018, the Corporation advised that they had their legal costs assessed, and that the amount of the lien had been reduced to just over $134,000. In this action, Mr. Swan seeks indemnification from costs on the grounds that he is a former Director, and asks that the lien be vacated.

Justice Nishikawa noted that despite having held the position of Director for 3 months, Mr. Swan has spent about six years litigating his claim for indemnity. She ordered that the lien of $219,000 be vacated and a new lien for the correct amount be registered. She noted that legal costs related to the “vexatious litigant” application should not be included, nor should the costs of a compliance letter where no proceeding was commenced in relation to the conduct described in the letter. She ordered additional costs (for this proceeding) of $18,000 to the Corporation.

Comment: Even with the reduced costs assessment this has turned into an expensive dispute for everyone involved.

Lebko v. Toronto Standard Condominium Co. 1862 2019 ONSC 1602
Decision Date: March 12, 2019

Ms. Lebko is a resident in TSCC 1862. On April 4, 2011, around 6pm, Ms. Lebko’s mother was visiting her at the condominium and fell while exiting Elevator 2, suffering a broken wrist and shoulder dislocation. A witness noticed that the elevator was not level with the foyer and estimated it to be 1/4 -1/2 inch below the foyer threshold, although no photographs were taken at the time. Ms. Lebko and her mother brought a claim against TSCC 1862, Del Property Management, thyssenkrupp Elevator, and G4S Secure Solutions. In this action, all four defendants ask for a summary dismissal on the grounds that there is no genuine issue for trial.

On April 2, 2011 (that is, two days before the accident), two residents reported that Elevator 2 was not stopping level with the floor and it was taken out of service by G4S Secure Solutions. On April 4, a thyssenkrupp Elevator technician attended, serviced the elevators, put Elevator 2 back into service, and left the building around 4:45. (It isn’t clear if this was a regular maintenance visit, or in response to complaints about Elevator 2.) After Ms. Lebko’s accident, several people used the same elevator without incident, although around 7pm a security officer noticed the elevator was having “levelling issues” and took it out of service.

Justice Brown granted the summary judgement motions of all four defendants. She found that none of the defendants were negligent or breached their duty of care to the plaintiff. TSCC 1862 had a reasonable system in place to keep the premises reasonably safe for visitors. Nothing indicates that G4S was negligent. Similarly, there was no evidence that thyssenkrupp’s conduct fell below the requisite standard of care.

Comment: A mediation in 2016 failed to settle the claim.

Brief Notices:

In Davidson v. CCC 73 Justice Labrosse finds that Divisional Court does not have jurisdiction to hear an appeal from an interlocutory order of a Small Claims Court judge.

A summary judgement has been denied in Jermark v. MTCC 1371. The issue: Jermark charges that it submitted the winning bid in a tender to replace the Kitec piping in the condominium, and that MTCC is in breach of contract for awarding the contract to another company. MTCC 1371 had asked for a summary dismissal but Justice Nakatsura has ruled that a trial is required. (Or perhaps they can come to an agreement through mediation?)

In Andrews v. Great Gulf the Human Rights Tribunal of Ontario has dismissed the application of a condominium owner who argued that the Corporation’s developer should have provided gender-inclusive washrooms in the pool and steam room areas. The building was designed and built “years or at least months” before Ontario Human Rights Commission’s Policy on Preventing Discrimination Because of Gender Identity and Gender Expression was approved in 2014.

About the image: Male nilgais fighting (Boselaphus tragocamelus), Lakeshwari, Gwalior district, India. (A “nilgai” is a large Asian antelope.) This file is not in the public domain: © Yann Forget / Wikimedia Commons, CC BY-SA 4.0, Link

Why Training Might not be the Answer

Dolphin Corporate Sales Trainings

Every so often I get an inquiry about training that goes something like this:

Me: Can you tell me why you’re interested in conflict resolution training?
Potential Client: We have two divisions that need to work together, but whenever they have a meeting, it ends up in a screaming match. So we’d like to get some training to improve their communication.

If you have two groups in open, hostile conflict, putting them together in a room for a day of training will not help. In fact, it might even make things worse. What this client really needs is to understand what is driving the conflict between the groups. Until the client knows this, any “solution” just amounts to throwing money at the problem.

Or the conversation might go like this:

Me: I got your message that you’re interested in anti-harassment training. Can you tell me what’s going on in your workplace?
Potential Client: We’ve had a few complaints about one of our managers. So we want to have a training session so everyone knows what is appropriate.

First, if you’ve had complaints about someone’s behaviour, you need to do some kind of investigation. Depending on the circumstances, it may not be necessary to do a full, formal investigation, but you need to get a better idea of what is going on.

Second, if the problem really is centered on one person, individual coaching for him or her is a better use of resources than group training.

My main point in all of this is: Solve the right problem. If you have ongoing workplace conflict, address that. If you have one manager whose behaviour is inappropriate, devise a plan for him or her. Don’t send a whole group out for training.

And if you’re unfortunate enough to have a whole culture of disrespect among the people in your organization, then you need a long-term strategy to address that. Training will play a part in that strategy – but don’t mistake the training (a tactic) for the strategy.

About the image: Rahulrdx223 [CC BY-SA 4.0 (]

Condo Law Digest – March 2019

Excavating new Union Station site 1915.jpg

Ania v. Spice Danforth Inc., 2019 ONSC 572
Decision Date: February 15, 2019

This is a dispute over an Agreement of Purchase and Sale (APS) of a townhouse condominium. The respondent is a condominium developer. The applicants entered into the agreement with the vendor in September 2016 for a unit that they were to occupy in March 2019. The occupancy date was later extended by one year. The applicants have made deposits of about $55,600 which are being held in trust by the respondent. In January 2018 Spice Danforth asked all purchasers for a binding and unconditional mortgage commitment, issued by a lender. The applicants supplied what they thought was adequate documentation. Over the next few months the vendors asked for more and more documentation, and the applicants did their best to comply. In April 2018 the vendors, not satisfied with the financial documents that the applicants produced, moved to terminate the APS.

It emerged in cross-examination that Spice Danforth was no longer planning a condominium development, but plans to build rental housing instead. The applicants ask the court to declare that the APS is in effect, that their deposit should be returned to them, and that there should be a trial with respect to their damages (as a result of the decision not to proceed with the condo development.) The respondent seeks a declaration that the applicants are in default, and that their deposit is forfeited.

Justice Swinton found that the applicants had complied with the APS and the financing requirements, and that the respondents acted unreasonably and in bad faith. She ordered that the deposit be returned with interest, and that there be a trial regarding the claim for damages.

Comment: Of the 116 purchasers of units in the development, 95 did not qualify for financing.

Horfil Holding Corp. v. Queens Walk Inc., 2019 ONSC 1381
Decision Date: February 27, 2019

The applicants are two dentists who have a practice together. The defendants are “Queen’s Walk,” a corporate developer, its directors and officers, “Bridlepath,” a real estate brokerage, and two employees of Bridlepath. The applicants entered into an APS in July 2017 to purchase a commercial unit in an as-yet unbuilt complex. The APS contained a restrictive covenant that the applicants would have the sole dental office. In September 2017 Queen’s Walk terminated the APS, claiming that the applicant’s credit wasn’t adequate. The plaintiffs claim that 1) Queen’s Walk never checked their credit and that they had sufficient funds to close the deal; and 2) Queen’s Walk failed to secure the termination of an agreement with another dentist to purchase a unit in the complex. They commenced an action for breach of contract, inducing breach of contract, deceit, misrepresentation, and negligence.

In this motion, the directors and officers of Queen’s Walk ask that all claims against them be struck. Queen’s Walk asks that claim against them for punitive damages be struck.

Justice Nishikawa decided that 1) There was no reasonable cause of action against the directors and officers of Queen’s Walk and so the claim could be struck. 2) The Statement of Claim does not support a claim for punitive damages against Queen’s Walk, and so that claim is struck. 3) The plaintiffs may amend their claim against Queen’s Walk, but not against directors and officers.

Friedrich v. MTCC No. 1018, 2019 ONSC 1153
Decision Date: February 19, 2019

This is a dismissal of an appeal. (However I cannot find the text of the original decision.) Mr. Friedrich owns a unit in MTCC No. 1018. The corporation made a decision to change the entry to Parking Level 1 from a telephone system to a motion sensor with monitored CCTV and a visit by a security guard at least every two hours. MTCC thus met the duty of an occupier under the Occupier’s Liability Act. Justice Myers found that Mr. Friedrich failed to prove that that MTCC No. 1018 breached the acceptable standard of care. Although vandalism occurred after the new system was in place, Mr. Friedrich did not offer any evidence that the corporation’s decision to make the changes was unreasonable or that they foreseeably caused his loss.

Comment: Once again we see judges upholding the principle that a condominium Board’s business judgment is entitle to deference.

About the image: Toronto construction in an earlier time. “Excavating the site of the new Union Station” by Dept. of Public Works – This image is available from the City of Toronto Archives, listed under the archival citation Fonds 200, Series 372, Subseries 30, Item 64. Public Domain, Link

Condo Law Digest – February 2019

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Walsh v. Badin, 2019 ONSC 689
Decision Date: January 28, 2019

The four plaintiffs are current or former directors of YCC 78. They have commenced an action against two owners for statements made in three anonymous letters distributed in 2016 and 2017. Relations within the corporation have been contentious for some time, with aggressive negative campaigns for Board positions, allegations of electoral fraud, and litigation. The defendants deny any involvement with the anonymous letters.

With this motion, the defendants ask the court to dismiss the action based on the anti-SLAPP provisions of the Courts of Justice Act (Sections 137.1 to 137.5). These provisions are meant to protect people who speak out about matters of public interest. Justice Nishikawa found that the subject of the letters – the internal workings of the condominium corporation – were not a matter of public interest. She also noted that it was “inconsistent” with the purposes of the anti-SLAPP provisions to deny writing the letters and at the same time to ask for protection against being sued for writing them. She dismissed the motion, but granted a second motion to strike portions of the Statement of Claim that were defamatory to one of the defendants.

Comment: Justice Nishikawa noted that it was “unfortunate that in a community such as the Condominium, the Board and residents have permitted relationships to deteriorate to the point that anonymous letter writing campaigns, threats, self-help and litigation are seen as an appropriate means of addressing disputes.”

Read about another ant-SLAPP case: Taft Management v Gentile in the October 2018 Condo Law Digest.

Tre Memovia Developments Ltd. v. 1491316 Ontario Inc., 2019 ONSC 4
Decision Date: January 18, 2019

Tre Memovia is the former owner of 2055 and 2057 Danforth Avenue; the defendants own and operate a dry-cleaning business next door at 2061 Danforth Ave. In 2013 Tre Memovia commenced an action against the defendant; (I could not find the details of their claim). In this motion, Tre Memovia asks for an order allowing its expert access to the defendant’s property in order to conduct invasive environmental testing for the presence of chlorinated solvents. The defendants have declined to allow this inspection.

An Environmental Site Assessment done in 2012 identified the defendant’s dry cleaning business as a possible source of soil contamination. Tre Memovia had planned to build a 12-story condominium but had to delay development. (At some point Tre Memovia sold the land. Google Earth shows a recent building on the site, so I assume that the soil was decontaminated before construction went ahead.) In summer 2017 Tre Memovia retained a new engineering firm (AiMS) because the expert they had worked with previously retired. Unlike the first engineer who did not recommend further testing, AiMS proposed further, more intrusive testing after their site assessment in fall 2018.

After sifting through several years of investigation results, arguments, and counter-arguments, Master Short denied the motion. He found that further testing at this time would not be useful or probative in determining the source of the contaminants. If Tre Memovia wanted to do invasive testing, they had enough information to make the request in 2013. There are no compelling reasons to override the defendant’s property rights at this point.

Comment: Although there was a lot of technical detail on both sides of the argument, the Master’s decision came down to Laches – unreasonable delay.

About the image: A redundant postbox by Evelyn Simak, CC BY-SA 2.0, Link