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Condominiums

. Toronto Standard Condominium Corporation No. 1628 v. Toronto Standard Condominium Corporation No. 1636 (II)

In Toronto Standard Condominium Corporation No. 1628 v. Toronto Standard Condominium Corporation No. 1636 (II) (Ont CA, 2021) the Court of Appeal considered whether oppression claims in a condo context may only be heard by the court:
[25] In our view, courts should generally be cautious in their approach to oppression claims of the type asserted here. In particular, courts should be wary of allowing such claims to overtake, and potentially distort, the dispute resolution process that lies at the heart of the Condominium Act, 1998, a central aspect of which is a preference for arbitration over court proceedings. In other words, courts should be alert to the possibility that persons, who are party to an arbitration agreement, are attempting to avoid that process by "piggybacking" onto claims made against others: see e.g. MTCC No. 965 v. MTCC No. 1031 and No. 1056, 2014 ONSC 5362, at para. 18; see also TELUS, at paras. 76, 98.

[26] In considering this issue, the motion judge erred in his interpretation of the oppression section of the Condominium Act, 1998. Assuming that any aspect of the dispute between the parties falls within the scope of s. 135 of the Condominium Act, 1998, a question that we do not determine here, we do not agree with the motion judge that such a claim can only be determined by a court.[2] In his reasons, the motion judge said, at para. 40: “Further, as set out in s. 135(1), applications under this provision can only be brought before this Court.”

[27] Section 135(1) reads:
An owner, a corporation, a declarant or a mortgagee of a unit may make an application to the Superior Court of Justice for an order under this section.
[28] The language of s. 135(1) is permissive, not mandatory. It contemplates that, in certain circumstances, it may be necessary to have resort to the Superior Court of Justice to obtain relief. However, s. 135(1) does not oust the jurisdiction of an arbitrator to consider the same relief, if that relief is part of the dispute in question that properly falls within the terms of the arbitration provision or within the terms of s. 132. In this case, we have already noted the broad language of the arbitration clause. There is nothing, in our view, that would preclude an arbitrator, acting under the authority of that arbitration clause, from considering the alleged oppressive conduct advanced by the respondent in appeal, at least as it relates to the actions of TSCC 1636.

[29] In saying that, we are aware that the dispute, at least insofar as the oppression claim is made, includes parties that may not technically be parties to the arbitration process. We say technically because it is not entirely clear, from the relationship between the parties and their status, whether they might fall within the ambit of the arbitration clause, or otherwise be subject to arbitration under s. 132 of the Condominium Act, 1998. We repeat that the emphasis in the Condominium Act, 1998, through s. 132, is on the resolution of various different forms of disputes by way of arbitration. ...
. Mohamoud v. Carleton Condominium Corporation No. 25

In Mohamoud v. Carleton Condominium Corporation No. 25 (Ont CA, 2021) the Court of Appeal set out the test for oppression under s.135 of the Condominium Act, 1998:
[8] Under s. 135(2) of the Act, the court must determine whether the impugned conduct is, or threatens to be, oppressive or unfairly prejudicial to the applicant or unfairly disregards their interests. The test under s. 135(2) has two prongs. First, the court must assess whether there has been a breach to the claimant’s reasonable expectations. If the answer is yes, the court must then go on to consider whether the conduct complained of amounts to oppression, unfair prejudice, or unfair disregard of the relevant interest: Metropolitan Toronto Condominium Corporation No. 1272 v. Beach Development (Phase II) Corporation, 2011 ONCA 667, 285 O.A.C. 372, at paras. 5-6; 3716724 Canada Inc. v. Carleton Condominium Corporation No. 375, 2016 ONCA 650, 61 B.L.R. (5th) 173, at para. 29.
. Amlani v. YYC 473

In Amlani v. YYC 473 (Div Ct, 2020) the Divisional Court considered whether a condo lien could be registered for compliance and enforcement without a s.134 Compliance Order from the court:
Validity of the Corporation’s Lien

[9] Section 85 of the Act allows for the automatic registration of a lien in respect of common expenses. Section 134 of the Act provides that expenses in respect of compliance and enforcement can only be the subject of a lien if the Corporation has obtained a compliance order from the Court. The application judge found that the expenses at issue were not common expenses but fell under s. 134 of the Act. Since there was no Court order authorizing a lien for those expenses, he found that the lien was invalid and must be discharged.

[10] The Appellant argues that the application judge misapprehended the meaning and inter-relationship of these sections and disregarded the definition of “common expense” in the Act, which lead him to the wrong conclusion.

[11] Section 85 of the Act provides:
85 (1) If an owner defaults in the obligation to contribute to the common expenses payable for the owner’s unit, the corporation has a lien against the owner’s unit and its appurtenant common interest for the unpaid amount together with all interest owing and all reasonable legal costs and reasonable expenses incurred by the corporation in connection with the collection or attempted collection of the unpaid amount. [Emphasis added]
[12] Section 134 of the Act provides, in relevant part:
134 (1) Subject to subsection (2), an owner, an occupier of a proposed unit, a corporation, a declarant, a lessor of a leasehold condominium corporation or a mortgagee of a unit may make an application to the Superior Court of Justice for an order enforcing compliance with any provision of this Act, the declaration, the by-laws, the rules or an agreement between two or more corporations for the mutual use, provision or maintenance or the cost-sharing of facilities or services of any of the parties to the agreement.

....

(5) If a corporation obtains an award of damages or costs in an order made against an owner or occupier of a unit, the damages or costs, together with any additional actual costs to the corporation in obtaining the order, shall be added to the common expenses for the unit and the corporation may specify a time for payment by the owner of the unit. [Emphasis added]
[13] “Common expenses” are defined to mean “the expenses related to the performance of the objects and duties of a corporation and all expenses specified as common expenses in this Act, the regulations or in a declaration”.

[14] The essential reasoning of the application judge on this point appears in paras. 34 and 35 of his decision:
[34] It is one thing to allow the corporation to enforce, by way of lien, common expenses that are applicable to all unit holders and that a majority of unitholders have approved. It is entirely another to allow a condominium corporation the unfettered, unilateral right to impose whatever costs it wants on a unitholder, refer to them as common expenses and thereby acquire the right to sell the unitholder’s apartment.

....

[35] I am strengthened in this view by other provisions in the Act that specifically allow a condominium corporation to add certain types of costs unique to a single owner to the common expenses of the particular unit holder without a court order. By way of example, sections 92(1) and (4) provide that a corporation can carry out certain repairs if an owner fails to do so and can add the cost of such repairs to the owner’s common expenses. In a similar vein, section 105(2) provides that if an owner causes damage, the lesser of the cost of repair or the corporation’s insurance deductible may added to the owner’s common expenses. Legal fees and enforcement costs do not fall into these categories.
[15] I can find no error in the application judge’s interpretation of these provisions of the Act. His interpretation is correct. There are numerous sections allowing condominium corporations to charge back expenses to an owner and to have a lien if the owner defaults, without the requirement of an order. However, as expressly provided, s. 134 is not one of them.
. Amlani v. YYC 473

In Amlani v. YYC 473 (Div Ct, 2020) the Divisional Court identifies a leading case on the oppression provisions of s.135(2) of the Condominium Act:
[29] The application judge correctly stated the legal test for oppression under s. 135(2) of the Act and applied the leading case, BCE Inc., Re, 2008 SCC 560, as well as several recent condominium oppression cases. The application of the oppression remedy is based on findings of fact and the exercise of discretion by the Court.
. Metropolitan Toronto Condominium Corporation No. 590 v. The Registered Owners and Mortgagees of Metropolitan Toronto Condominium Corporation No. 590

In Metropolitan Toronto Condominium Corporation No. 590 v. The Registered Owners and Mortgagees of Metropolitan Toronto Condominium Corporation No. 590 (Ont CA, 2020) the Court of Appeal heard an appeal of a Condominium Act, 1998 application to amend the condo's Declaration. It granted the application to amend for the Declaration's "error or inconsistency" under s.109(3) for failure to address who was responsible for certain damage (here, chimney flues), the condo corporation through it's responsibility for common elements - or individual owners:
[27] Whether confusion about maintenance and repair would constitute an inconsistency was addressed in one of the authorities that was provided to the application judge. In Carleton Condominium Corp. No. 26 v. Nicholson, [2009] O.J. No. 1831, 2009 CarswellOnt 2640 (S.C.J.), aff’d 2010 ONCA 80, Power J. concluded that apparent conflict or confusion regarding the obligations to maintain and repair as between the condominium corporation and the unit owners was an “error or inconsistency” as those terms are used in the Condominium Act.

[28] The purpose of the Declaration is to clearly delineate the responsibilities of the condominium corporation, on the one hand, and the unit owners, on the other. Here that purpose is not achieved. Sections 22 and 23 are inconsistent, or at the very least unclear, in the obligations that they impose.


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