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 – April 2018

2009 windowbox London 3479978387.jpg

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

Condo Law Digest – March 2018

CommercialAppealLobby.JPG

Scicluna v. Solstice Two Limited, 2018 ONCA 176
Decision Kate: February 23, 2018
http://canlii.ca/t/hqktm

This is an appeal by two parties against the decision made by Justice Brown in Scicluna v Solstice. Ms. Scicluna agreed to purchase a condominium from Solstice Two and advanced just over $293,000. She lost her job and was unable to pay the remaining $78,000. At first, Solstice Two agreed to return to Ms. Scicluna all of the money she had advanced, less $30,000, provided that the condominium was resold. It was indeed resold (for $435,000). However Ms. Scicluna refused to sign the release document, mistakenly believing that Solstice would keep $60,000 rather than $30,000. She commenced a claim, and in response Solstice invoked the forfeiture provision in their original agreement, demanding to retain every cent that Ms. Scicluna had paid. Justice Brown granted Ms. Scicluna relief from forfeiture but instead of giving the money to Ms. Scicluna, she gave it to Ms. Scicluna’s trustee in bankruptcy, Keven Thatcher and Associates (KTL).

In this action, Ms. Scicluna argues that Justice Brown erred in giving the money to KTL, and Solstice argues that Ms. Scicluna should not have been granted relief from forfeiture. The appeal judges upheld Justice Brown’s decision. Regarding the claim by Solstice, it would be a “grossly disproportionate windfall” for them to retain the full amount paid by Ms. Scicluna. Regarding Ms. Scicluna’s appeal, she did not fully disclose to KTL her claim to the deposit on the condo, or her lawsuits against Solstice. It would not advance the principles of the Bankruptcy and Insolvency Act for her to retain the funds.

Comment: Costs of $5000 each from Ms. Scicluna and Solstice were granted to KTL. The trial judge had declined to order costs, saying that the matter should have settled. (For anyone keeping track, there has now been a full trial and an appeal over a matter that “should have settled.”)

Axess Law Professional Corporation v. Sood
Decision Date: February 1, 2018
http://canlii.ca/t/hq5ln

This is an appeal of a small claims court decision. Mr. Sood purchased a condominium in 2015 and was represented in the transaction by Axess. Two different taxes were due on the purchase: Ontario Land Transfer Tax and Municipal Land Transfer Tax. As it happened, on the very day that Mr. Sood’s transaction closed, an automatic software update in the system at Axess introduced an additional step in order to have both taxes included on the Trust Ledger Statement. When the transaction closed, the Transfer document included both taxes, but Axess never received the funds for the Municipal Transfer tax from Mr. Sood. Instead the funds were automatically paid out to the tax authority from the law firm’s own accounts.

Three months later, when Axess noticed the error, they requested payment from Mr. Sood. He refused, and Axess commenced a small claims court action. Mr. Sood’s appeal relies on Subsection 2(1) of the Solicitor’s Act. The legal arguments turned on whether or not the tax payment should be considered a “disbursement.” In the end, Justice Matheson denied the appeal.

Comment: Liability for tax goes to the purchaser, not their lawyers.

Brief Notices

An appeal has been denied in White Snow and Sunshine Holdings Inc. v. Metropolitan Toronto Condominium Corporation No. 561. Costs of $10,000 were awarded to the respondent. I summarized this dispute over access to condominium amenities in September 2017.

Manorama Sennek’s appeal from the judgment declaring her to be a “vexatious litigant” has been dismissed. Carleton Condominium Corporation No. 116 has spent “well over” $100,000 on disputes with her.

About the image: Lobby of the Old Commercial Appeal Building, Memphis, 1961 by ZeamaysOwn work, CC BY-SA 3.0, Link

Condo Law Digest – February 2018

Rosario under construction.jpgJones v. 2341464 Ontario Inc., 2018 ONSC 717
Decision Date: January 30, 2018
http://canlii.ca/t/hq4hm

In May 2013 the parties entered into an agreement of purchase and sale. The applicants were to purchase a pre-construction unit in a building on Niagara Street for $649,000. The occupancy date was to be on or before September 1, 2014. In May 2013 the occupancy date was moved to no later than February 1, 2015. Construction did not actually begin until May 2016. In February 2017 the applicants were advised of some changes to the layout of the condominium units, including the removal of balconies. The applicants decided to proceed with the purchase despite these changes. Later the same month the defendant contacted the respondents and advised them that, due to the delays and to costs they had incurred in the planning process, they would no longer honour the purchase and sale agreement. The new price (on which the applicants had “first right of refusal”) was to be $875,000.

Justice Favreau found the original agreement of purchase and sale to be valid and enforceable. He made an order of specific performance granting the applicants occupancy of their unit within 30 days, and also awarded them $20,000 in costs.

Comment: Justice Favreau said that it was “evident” that the respondents were reluctant to complete the sale so they could benefit from an increase in the value of real estate since the agreement was made.

Toronto Condominium Corp. 1462 v. Dangubic, 2018 ONSC 491
Decision Date: January 19, 2018
http://canlii.ca/t/hpvh1

Mr. Dangubic owns a unit in TSCC No. 1462. Justice Morgan describes him as “not a good neighbor,” as he has violated other residents’ rights of quiet enjoyment, has gotten into verbal conflicts with others, and has left obscene and aggressive voice messages. TSCC charges that he owes over $14,000 in common expenses; these consist mainly of the legal cost of compliance letters and of a lien, and costs of attempted collection of arrears. The main legal issue at stake is whether the lien registered by TSCC 1462 is valid.

Justice Morgan ruled that the lien was indeed valid, as Mr. Dangubic was aware of the claim against him, knew the circumstances of why and how fees were incurred, and the fees are reasonable for the legal work done. He granted TSCC 1462’s request for summary judgment and also granted them costs on a substantial indemnity basis of over $16,000.

Comment: Disruptive owners should understand that the legal cost of getting them to comply with the corporation’s rules will not be borne by the owners at large.

About the image: Building under construction in Rosario, Argentina, which like Toronto is experiencing a construction boom. CC BY-SA 2.5, Link

Condo Law Digest – January 2018

Déneigement westmount.jpg

C.M. Callow Inc. v. Tammy Zollinger et al., 2017 ONSC 7095
Decision Date: November 27, 2017
http://canlii.ca/t/hp00r

C.M. Callow Inc. is a property maintenance company that provided winter and summer maintenance at a condominium complex in Ottawa, managed by the Condominium Management Group (CMG). CMG terminated the two-year winter maintenance contract with Callow earlier than expected, while Ms. Zollinger was property manager. The issues in this trial were whether CMG was in breach of contract, and if so, what are Callow’s damages?

Callow’s position is that the CMG decided to terminate the winter maintenance contract in March 2013 but did not advise him until Sept 3013. Between March and September, while Callow was fulfilling the summer maintenance contract, Ms. Zollinger and certain board members falsely represented that the winter maintenance contract would be renewed or extended. During this time, Callow provided extra “freebie” services to enhance the property, as an incentive to CMG to renew the two-year contract.

CMG’s position is that Callow’s winter maintenance work did not meet their expectations, and that they were within their rights to terminate the contract with 10-days notice, and they did not falsely represent nor act in bad faith.

This case hinged primarily on two things: the evidence (including emails exchanged among board members and the parties’ credibility), and some fundamental principles of common law contracts. Justice O’Bonsawin favoured the evidence provided by Callow, saying that witnesses for the defendant were prone to exaggeration and answered questions in ways that were at odds with the written record. She found no evidence that Callow’s work was below standard. Furthermore, parties to a contract have a duty to act honestly in their dealings and not seek to undermine the other’s interests in bad faith. CMG actively deceived Callow by not disclosing their intention to terminate the contract. Justice O’Bonsawin awarded damages of just over $80,000 (the value of the contract after expenses and the value of equipment leased in anticipation of fulfilling the contract) to Callow.

Comment: Speak with a lawyer before breaking a contract, no matter how reasonable you believe your position to be.

About the image: Snow removal in Westmount (Montreal) Canada in 1944 by Conrad PoirierThis image is available from Bibliothèque et Archives nationales du Québec
Public Domain, Link

Condo Law Digest – October 2017

"For Sale" sign at Berkley Mill, Norfolk, Virginia, April 16, 1927 (16052444819).jpg

Shah v. Southdown Towns Ltd., 2017 ONSC 5391
Decision Date: Sept 11, 2017
http://canlii.ca/t/h5w8p

In the fall of 2016 each of the five applicants entered into a Purchase and Sale Agreement to buy a pre-construction condominium unit and a parking spot from Southdown Towns. (Mr. Shah was the first of the five applicants to enter into the Agreement, and he dealt with Southdown on behalf of the others.) Each purchaser paid a deposit and agreed to provide proof of mortgage approval within 10 days of the acceptance of the Agreement. If this condition was not met, Southdown Towns had the option to terminate the Agreement. In Feb 2017 Southdown sent Mr. Shah an email requesting confirmation of mortgage approval. A month later counsel for Southdown sent a letter to each of the applicants requesting the mortgage approval by March 30, and warning them that Southdown Towns would exercise its rights to terminate the Agreement if they did not comply.

Mr. Shah claims that he snail-mailed the documents on March 28, but provided nothing to support this claim. On March 31 he dropped off the documents at the sales center. These documents proved to be inadequate. On the same day Southdown Towns wrote to each purchaser, terminating the Purchase and Sale Agreement. The applicants finally provided valid mortgage approvals in mid-April. In this action, the Applicants ask the court for “relief from forfeiture;” that is, for the Purchase and Sale Agreement to go ahead. They estimate that each of them will lose $150,000 to $200,000 in potential value (the increase in value of the units between time of purchase and move-in date) if relief is not granted.

Justice Emory declined to grant the requested relief, saying that the Applicants had not exercised reasonable diligence to comply with the Agreement

Comment: The Applicants will receive their deposits back.

Patel v. Davis, 2017 ONSC 5496
Decision Date: Sept 22, 2017
http://canlii.ca/t/h694x

In June 2017 Mr. Patel entered into a valid and enforceable agreement to purchase a condominium unit from Mr. Davis, with a closing date of August 31, 2017. Sometime in July Mr. Davis seems to have had a change of heart and refused to complete the sale. In this action, Mr. Patel seeks an order that Mr. Davis deliver clear title to the property.

Justice Peterson granted the application, stating that the condominium is sufficiently unique (large footprint, two bedrooms, overlooking a park and with a wheelchair-accessible bathroom), that another comparable property would not be readily available.

Comment: Mr. Davis was not represented by counsel, did not file a defense, and did not appear in Court.

Zordel v. MTCC No. 949, 2017 ONSC 5544
Decision Date: Sept 19, 2017
http://canlii.ca/t/h67pp

The applicants are owners of units in MTCC No. 949. In June 2016 the Corporation switched its cable TV and internet provider from Rogers to a new service provider, Frontline. As previously, the costs for these services are charged as a common expense to unit owners. The applicants 1) challenge the jurisdiction of MTCC No. 949 to enter into this agreement. 2) Assert that MTCC No. 949 should have sought the approval of 2/3s of unit owners before making the switch. 3) Seek an order requiring MTCC No. 949 to allow them to opt out of the service. 4) Submit that MTCC No. 949 has acted oppressively towards them. 5) Seek clarification from court as to owner expectations when meetings are requested.

Justice Cavanagh dismissed the application: 1) MTCC No. 949 does have jurisdiction, according to Subsections 17(1) and (2) of the Condominium Act, its own by-laws, and the decision in Mancuso v. York Condominium Corp. No. 216. 2) MTCC No. 949 did not require approval of 2/3s of unit owners as the change in service is not “substantial.” 3) As MTCC had jurisdiction to make the bulk services agreement, unit owners do not have the right to opt-out of it. 4) The conduct of MTCC No. 949 towards the applicants does not meet the threshold of oppression. 5) This case is not a proper one to clarify the issues around meeting requisitions by owners.

I missed this decision when it was released in July:

Carleton Condominium Corporation No. 282 v Yahoo! Inc., 2017 ONSC 4385
Decision Date: July 18, 2017
http://canlii.ca/t/h4w8v

In November 2016 an individual with the alias “Ian Fleming” sent emails to the owners and occupants of CCC No. 282, accusing the Board of unethical behaviour (accepting kickbacks) and harassment of staff. In this decision Justice Ryan Bell granted a “Norwich order” to CCC No. 282 requiring Yahoo Canada to disclose information necessary to obtain the identity of the author of these emails.

About the image: State Archives of North Carolinahttps://www.flickr.com/photos/north-carolina-state-archives/16052444819/, No restrictions, Link

Condo Law Digest – September 2017

Münster, LVM, Skulptur -Körper und Seele- -- 2016 -- 5920-6.jpg

White Snow and Sunshine Holdings Inc. v. Metropolitan Toronto Condominium Corporation No. 561, 2017 ONSC 4558
Decision Date: July 28, 2017
http://canlii.ca/t/h5bsj

The applicant owns the two commercial units in MTCC No. 561, a residential condominium. At present, the applicant’s employees are not allowed to use the condominium’s residential facilities (a swimming pool, a gym, squash court, etc.), although the applicant pays common expense fees. After unsuccessful negotiations with the Board, the applicant has brought this application to require that the corporation change its Declaration and allow his employees to use the recreational facilities.

Justice Lederer dismissed the application, drawing on Section 7(4) of the Condominium Act. He also noted a site specific by-law passed by the City of Toronto which required the developer of MTCC No. 561 to provide recreational space for the exclusive use of the residents of the building.

Comment: Costs of $11,000 were ordered payable by the Applicant.

Metropolitan Toronto Condominium Corporation 1067 v. 1388020 Ontario Corp., 2017 ONSC 4793
Decision Date: August 14, 2017
http://canlii.ca/t/h5c30

The defendant owns 8 condominium units and 3 parking spaces in MTCC No. 1067. This dispute is over the defendant’s unpaid common expense fees, interest charges, and additional expenses. The parties resolved most of their disagreements before appearing in front of the judge. The remaining issues were the rate of interest charge, additional claimed expenses, and legal costs. In particular, the defendant claimed that the rate of prime plus 30% specified in the corporation by-laws, was excessive.

Justice Ferguson allowed the interest rate to stand but disallowed the corporation from claiming additional “collection” expenses. He also awarded costs of $30,000 to the plaintiff.

Comment: Familiarize yourself with a condominium’s Declaration and By-laws before moving in so fees and interest charges don’t come as a surprise!

Brief Notices

The LSUC has found that a lawyer engaged in professional misconduct by breaching the trust requirements for deposits under the Condominium Act, accepting cash payments over $7500, making unauthorized withdrawals from trust, and allowing another lawyer (neither an employee nor a partner) to use his trust accounts. Read the full summary of the decision. The penalty is a 2-month suspension, 6-months of financial reporting, and a spot audit requirement.

An appeal has been denied in Cheung v. York Region Condominium Corporation No. 759. (I summarized this parking dispute in the Mid-summer 2016 post.)

 

About the Image: Sculpture “Body and Soul” (Duk-Kyu Ryang, 2015) in front of the office building of the LVM, Münster, North Rhine-Westphalia, Germany, by Dietmar RabichSelf-photographed, CC BY-SA 4.0, Link

Condo Law Digest – Mid-summer 2017

Keep out of Romanée-Conti.jpg

YCC No. 41 v Schneider, 2017 ONSC 3709
Decision Date: June 15, 2017
http://canlii.ca/t/h4bh6

This conflict arises from an insect infestation. In October 2015 Justice Diamond ordered that the Schneiders permit YCC No. 41 and its agents to enter their unit no later than November 13 in order to conduct a “flush and vac” insecticide treatment. On October 28 the corporation sent the Schneiders a letter advising them that Orkin (the pest control company) would come on Nov 13 to prepare the unit, and that the treatment would take place on Nov 16. The letter included an “Orkin Preparation Sheet” which said that the occupants (and not Orkin) were required to prepare the unit. It is not clear what exactly happened on November 13 when personnel from Orkin, together with staff from YCC No. 41 showed up at the Schneiders’ door. The Schneiders may or may not have prepared the unit themselves, and they may or may not have refused entry.

In this application, YCC No. 41 sought an order that the Schneiders had breached Justice Diamond’s order of October 2015. (In the original application, they also sought an order requiring the Schneiders to vacate and sell their unit, but later gave up this request.) After a 1-day trial, Justice Diamond dismissed YCC No. 41’s request for an order, citing the confusion created by the contradiction between the letter (stating that Orkin would prepare the unit) and the Preparation Sheet (stating that the occupants should prepare the unit.) He suggested that each party bear their own costs.

Comment: Litigation (complicated by poor communication) is a rather blunt means for gaining cooperation. One can only hope that the unit was treated sometime before the June 2017 trial.

Louiseize v Peel Condominium Corporation No. 103, 2017 ONSC 4031
Decision Date: June 29, 2017
http://canlii.ca/t/h4kd9

This is a dismissal of an appeal to an arbitrator’s award. Mr. Louiseize purchased three units in PCC No. 103 between 2001 and 2004 and has been renting them to non-related tenants for as long as he has owned them. The condominium’s Declaration specifies that units are to be used as single-family dwellings only. However the condominium took no real action to enforce the declaration until October 2013. At the November 2016 arbitration, PCC No. 103 asked for an order requiring immediate compliance with the single family restriction. Mr. Louiseize asked for the right to continue renting to unrelated tenants for a period equal to half the time he had owned the units, or failing that, compensation of $600/month per unit for lost income for the same period of time. ($600/month is apparently the difference between the expected rent for a single family and the amount that unrelated tenants could be charged. Is anyone else reminded of that old joke about the man who killed his parents, then threw himself on the mercy of the court on the grounds he was an orphan?)

The arbitrator gave Mr. Louiseize until August 2017 to comply with the single family restriction and awarded PCC No. 103 costs of $30,000. In the appeal, Mr. Louiseize asked for 75 months to change the use of two of his units, and that each party bear their own costs and share the costs of the arbitration. Justice Gordon heard the appeal but dismissed it, saying that the arbitrator had made no errors in law or principle, and awarded PCC No. 103 costs of $8200 for the appeal.

Comment: With the popularity of AirBnB, I suspect we’ll see more corporations cracking down on the single family provisions in their declarations.

Following-up

A costs award has been issued for Heyde v. Theberge Developments Limited, which was a motion to certify a class action suit. Justice Smith awarded costs of $56,000 to Heyde, despite the fact that they were only partially successful. The defendant had asked each party to bear their own costs.

I summarized CIBC Mortgages Inc. v. York Condominium Corporation No. 385 in November 2016, and wrote about the costs decision in January 2017. At the end of June the Ontario Court of Appeal dismissed appeals of both the original decision and the costs award.

About the Image: By Tomas erOwn work, CC BY-SA 3.0, Link

Condo Law Digest – June 2017

Airstream Trailer (1333647988).jpg

Bomba-Bibi v. Brookfield Condominium Services Ltd., 2017 HRTO 513
Decision Date: May 8, 2017
http://canlii.ca/t/h3q1b

Ms. Bomba-Bibi is an owner of a condominium unit in a building managed by Brookfield. In November 2015 and then in December 2015 she received letters from the corporation and its lawyer asking her to move a trailer from her parking spot. In February 2016 she received a follow-up letter, asking her to pay the lawyer’s fees or face a notice of lien if she did not. She eventually moved the trailer but did not pay the lawyer’s fees and did not receive a notice of lien.

Ms. Bomba-Bibi charges that she was not allowed to leave the trailer in her parking space because of her race, and that other residents were permitted to leave various items in their parking spaces. Brookfield and the corporation denied any discrimination and stated that other residents had also been asked to move items from their parking spots. The HRTO adjudicator dismissed the application as having no reasonable chance of success, given that Ms. Bomba-Bibi had no evidence that the alleged unfair treatment was due to her race.

Comment: Corporations and management companies must be consistent when enforcing condominium rules. The perception of selective enforcement often contributes to conflict.

Yeung v Chan, 2017 ONSC 3138
Decision Date: May 19, 2017
http://canlii.ca/t/h3vh5

This is a successful appeal of a Small Claims Court decision. Ms Chan purchased a unit in a newly constructed condominium with a closing date in January 2012. Before the closing date, she decided to “flip” the property. The respondents (Ms Yeung and Mr. Ho) agreed to buy it and put down a deposit of $15,000. The sale unraveled. Someone (not clear who) drafted a mutual release after the failed closing. The document covers how the deposit is to be divided and includes a clause that the realtor will abandon any claim for commissions.

Ms Yeung and Mr. Ho sued Ms Chan in Small Claims Court for the return of their deposit; Ms Chan counter-sued for $25,000. The original claim and the appeal hinge on whether the mutual release was a legally binding document. Deputy Judge Fisher ruled that it was, and the appeal judge disagreed. The release was never signed by the realtor, sections of it are crossed out and written over (not clear when or by whom), and it seems to have been executed on May 2, 2012, despite stating that it was “irrevocable” on two different dates in January 2012. Ms Chan did not testify at the original trial, and the trial judge accepted the testimony of her husband regarding his intentions for the release, despite the fact that he was not a party to the transaction. He awarded $7500 to Ms Yeung and Mr. Ho.

In the appeal Justice Boswell ruled in favour of Ms Chan, finding that the trial judge erred in concluding that the release was binding and enforceable. In his final reckoning he took into account Ms Chan’s profits from the rental of her unit (which she would not have enjoyed had she sold her unit to the respondents) and awarded her nearly $11,000.

Comment: On the eve of the original trial, Ms Yeung and Mr. Ho offered to “walk away,” meaning that Ms Chan would have retained the entire $15,000 deposit. So although the appeal was successful, Ms Chan is left with less money than she would have, had she accepted their offer.

About the Image: By dave_7 from Lethbridge, Canada – Airstream Trailer, CC BY-SA 2.0, Link

Condo Law Digest – May 2017

Manzanillo strand.jpgMcNairn v Murphy and Pene 2017 ONSC 1678
Decision Date: April 6, 2017
http://canlii.ca/t/h32j6

McNairn is a Canadian lawyer who purchased a condominium in Costa Rica in April 2014. At the time of purchase, the property management company was under investigation for fraud. In September 2014 McNairn was elected President of the Home Owners Association and a new property management company was engaged. In early 2015 the new property manager contacted McNairn because he had been verbally abused by one of the condominium ownersand felt threatened; he resigned. McNairn was discouraged by these events and announced his resignation to the other owners via email in June 2015.

In response, Shannon Murphy, one of the defendants, sent a note (through the magic of the “reply all” option) to the other owners  in which she said that the “President quit after accusations of theft.” McNairn received the email and wrote to Murphy, explaining the situation and inviting her to get in touch. He later asked her to retract her statement and apologize. In response, Murphy cut and pasted McNairn’s email to her and made a half-hearted apology. Upon receiving this communication, Pene (another owner, also a lawyer) sent a message to the group, accusing McNairn of threatening and bullying Murphy, of violating professional ethics, and of failing to be honest in his dealings with the other owners. These allegations caused McNairn considerable stress and anxiety, as well as professional embarrassment. After a failed attempt to resolve things with Murphy and Pene, McNairn commenced litigation. Neither Defendant filed a defense and both have been noted in default.

Justice Beaudoin found in favor of McNairn and awarded him damages of $70,000 against Murphy and $90,000 against Pene, plus costs.

Comment: A little sad that conflict occurs among condominium owners even under the sunny skies of Costa Rica.

York Condominium Corp No 163 v Robinson
Decision Date: April 19, 2017
http://canlii.ca/t/h387b

The respondent is an owner and resident of YCC No. 163 who frequently communicates with the building staff regarding maintenance and governance issues. Unfortunately, her manner of communication is extremely disrespectful to the point of being verbally abusive (“insult, body shaming, name calling, and other forms of coarse language and rudeness”). In previous years she would communicate in person; more recently these communications have come in the form of virtually daily emails. The respondent has a right to complain and some of her complaints are valid. However the condominium is also a workplace and the position of YCC 163 is that the office staff should not have to put up with what amounts to daily harassment.

Justice Morgan agreed and ordered that Ms Robinson shall refrain from abusing, harassing, threatening, or intimidating any employee or representative of YCC 163. He also ordered that she pay costs of $15,000.

Comment: Download my article on the Condominium as Workplace that appeared in Condo Business.

About the image: Manzanillo Beach, Costa Rica. By Haakon S. Krohn – Own work, CC BY-SA 3.0, Link