In this episode, we will do fast and furious refresher on a multitude of condo-related topics that keep popping up, including:
- Who is responsible for repairing the unit after water damage?
- Can we still do virtual meetings?
- EV chargers: Do I need a by-law or an EV agreement?
- Who can modify common elements (and how)?
- Liens: What they cover and when to register them?
- Can "Single family provisions" prevent short-term rentals?
- Are smoke free buildings legal?
- What is covered by the corporation's insurance?
- What dispute can I bring to the CAT?
- Who can chair our AGM?
Speakers
- Rod Escayola (Gowling WLG)
- Graeme MacPherson (Gowling WLG)
- Nailah Ramsoomair (Gowling WLG)
- Josée Deslongchamps (Condo Management Group)
Transcript
[AUDIO LOGO] [MUSIC PLAYING]
ROD ESCAYOLA: Hello, hello. My name is Rod Escayola, and I'm your condominium lawyer with Gowling WLG. And I have good and bad news. Let's start with the bad news. Summer's over, folks. And you know summer's over.
The first sign that summer's about to be over is when the Ontario peaches come out to your grocery stores. When that happens, it's a glorious and happy day in my stomach. But it's a sad day in my heart, because I know summer's over after that.
The good news is that the Condo Adviser Webinars are back. So that's the good news. Now being the first week of September, we thought that maybe we would ease into this condo madness-- condo madness. And we thought we'd go with a back-to-condo school topic today.
It's going to be a fast-paced all condo things, basically a back-to-the-basics kind of refresher. But you need to pass this episode to be able to move on to the next episodes. And you have to take notes, because there's an exam at the end of this webinar.
OK. So to be able to get our engines warmed up again and to refresh our memory about all condo matters, we stop at nothing. We went and we got you the best teachers out there in the industry. We looked high and low and mostly low. They were hiding because it was summertime. And we got some of your favorites, I'm sure.
So first and foremost, we have Josée Deslongchamps. She's with the Condo Management Group in Ottawa. The mother hen of condo of the condo industry and this neck of the woods. And the question, to introduce our panelists tonight is-- well, initially, I was going to ask, what's your least favorite class? But everybody hated gym class, apparently, except Graeme. And so I thought maybe I'll spice things up. And I'll ask you instead, Josée, who was your favorite teacher?
JOSEE DESLONGCHAMPS: Oh, there were many. But my high school English Literature teacher, Pierre Banar, was by far my favorite teacher. And we called him The Guru. And so many years later, he actually became a condo owner in one of my buildings. And I had the privilege of registering him in his new unit. It was really quite interesting.
ROD ESCAYOLA: That's amazing. That's amazing. I have a similar story with my Contract Law professor, and he's also in one of the condos around where I live. And-- but every time I see him, I get that nightmare. I didn't study for the exam, and I'm now in the exam class. So, yeah, Mr. Mannering, amazing, amazing teacher.
OK. So now moving on to the condo cousins. We have-- let's start with Nailah. And I'm going to ask you as well, Nailah, who's your favorite teacher?
NAILAH RAMSOOMAIR: Everyone, my favorite teacher would probably be my high school World History teacher, Ms. Corazza. She wasn't the nicest teacher. She was, in fact, a little mean. She practiced that tough love. But you know what, it got me here. So-- [LAUGHS]
ROD ESCAYOLA: Amazing. So this is a sign that you're made for the condo industry. Tough love, going through a-- that's amazing. OK, perfect. And now on to the only person that liked gym class apparently and on this panel. So we have Graeme MacPherson. Who's your favorite teacher, Graeme?
GRAEME MCPHERSON: I think my favorite teacher, believe it or not, was my high school math teacher, Mr. Sal. He really-- the guy really loves math. It's impossible not to get excited about numbers when he's talking. Now, unfortunately, that didn't really stick, because here I am as a lawyer, notoriously bad at math. But I had fun learning about it. And I'm sure, if you had asked me back in high school, I would have had smarter things to say about numbers than I do now.
ROD ESCAYOLA: Nice. OK, perfect. So everybody's excited to be back. We have a lot of activity on the chat, people introducing themselves. That's amazing. And so keep the chat alive, exchange ideas, maybe some love notes secretly. You can exchange them as long as the teacher doesn't see that. That's all fair. If you put a question in the Q&A, it may be difficult for us to see it. And so if you have a burning question, you should probably put it in the-- sorry.
If you put it in the chat, we may lose sight of it, because it's going to go up. If you put it in the Q&A, we may get to see it. And it's easier for us to just ignore it when we know it's a question. And we're just [INAUDIBLE].
No, but seriously, if you put it in the Q&A, we may get to see it. If we have time, we'll answer it. I see there's already a question. So we'll have to see what that one's about. The usual housekeeping-- before we jump in, it's the usual disclaimer.
So keep in mind that, if you're watching this webinar from far away and abroad, this webinar is really Ontario centric. So all the reference to legislation are references to Ontario legislation. Also, please keep in mind that the information we're providing you is as accurate as possible. But most importantly, as accurate as possible on September 6, 2023. So if you're watching this later on, when we upload it to our website, it may be a bit stale.
Speaking of uploading, we have yet to upload the last two episodes. And that's because we're having some technical difficulties that I'm working on. And, apparently, one of the ones that we didn't upload is a favorite.
Everybody wants to know, when are you going to upload the-- is it time to change your condo manager? It's truly a technical issue. It's not the management industry that is sending me demand letters telling me not to upload it. So we're still working on that. I'm sorry, but eventually--
JOSEE DESLONGCHAMPS: Nothing to do with it. Nothing.
[LAUGHTER]
ROD ESCAYOLA: That's right, the lobby. They got a strong lobby, I got to tell you. OK. So what else do we got here? That's it. That's about it, I think. OK. And whatever information we share today is information that's just general in nature. So if you really have a burning question, you should really consult with your experts. They're the best ones to answer your questions and give you an answer that's tailored to your needs. OK, wonderful, fantastic.
We're done with the boring part. And now we're going to jump into the class, the first class, which will be-- I have a substitute teacher, teacher Graeme, Graeme McPherson. So, Graeme, this is, by the way, our most read condo blog ever. Who is responsible to repair our unit after water damage? And so once and for all, Mr. McPherson, who's responsible?
GRAEME MCPHERSON: Well, in true lawyer fashion, to the surprise of no one, I must answer that it depends. But I'm not surprised to hear this is our most read blog. And that I think this is one of the most common questions that at least I receive is, there's been damage by water or something else, who's responsible for it? The condo or the owner whose unit is affected? And the starting point that-- here's a little look inside the brain of a lawyer when we get these questions.
The starting point is always to start at the Condominium Act and work your way down from there. And so the starting point, we look at Section 89 of the Act that tells us that subject to Section 91 and 123, which we'll get to in a minute-- but subject to those, the corporation shall repair units and common elements after damage. However, Section 91 says that the declaration can alter that obligation to maintain or repair after damage, as set out in the Act. And it can include that each owner will repair their unit after damage.
So what the Act is doing there is saying that, unless your declaration says otherwise, the default setting is that the corporation will be responsible for those repairs. But you can change that with your declaration. And I've got to be honest, it is few and far between for the declaration to not alter that. In most circumstances, the owner is responsible to repair their unit.
But again, this is why I say it depends. Every declaration is different. Every condominium is different. So you have to check your governing documents. Now, in addition to the declaration, which will set out who's responsible to repair what, there may also be a question of, to what extent are you responsible to repair or how much of it or what portion of it is yours to repair versus the corporation's?
And so for that, we also have to look at a couple other governing documents that a lot of condominiums have. Not all condominiums have both of these, but they're quite common in the industry. They're an insurance deductible bylaw and a standard unit bylaw. Now, Rod, when we're talking about--
ROD ESCAYOLA: Yeah.
GRAEME MCPHERSON: Know we're talking about a [INAUDIBLE] down the road.
ROD ESCAYOLA: Do you want me to jump to the slides? Do you want to cover those?
GRAEME MCPHERSON: Sure, yeah. So the insurance deductible bylaw, what that one does is basically states that if there is an event that's covered by the corporation's insurance, that depending on the circumstances of what caused the event or where it was, the owner of the unit affected or the owner of the unit that caused the event may be on the hook, at least for the corporation's deductible. And that can actually be quite high. We've seen some condo deductibles as high as-- I've seen them go up to 50,000, 70,000 before.
So it can be quite serious and, often, the deductible can cover the entire amount of damage we're talking about. So every insurance deductible bylaw is different. Sometimes they're based on whose fault it is. Sometimes they're based on where the damage is. Sometimes they're based on where the source of the damage is. So you need to check that out when considering who's responsible for damage.
ROD ESCAYOLA: OK. And do you want to tackle the standard unit bylaw as well?
GRAEME MCPHERSON: Yeah, that's the other one that's quite often at play, and it goes hand-in-hand with the declaration and the insurance deductible bylaw. Because what this bylaw does is, it sets out, OK, well, if the owner-- if the corporation is responsible for any part of the unit, what part of the unit are they responsible for, and what part of the unit is a quote unquote, "improvement" that the owner is responsible for?
And the idea there is that, if I get diamond-crusted kitchen cabinetry and marble flooring and I build my Roman bath house in my unit, the corporation and therefore all of the other owners probably don't want to be insuring that. I think it's fair to say that, well, tastes aside, I've improved the unit. And so the question becomes, well, what part of the unit is an improvement, and what part of it is just the standard unit? And owners are responsible to maintain and insure and repair the standard or the improvements to the unit, whereas the corporation may be on the hook to at least bring it to the standard.
And so your standard unit bylaw might say we cover carpeting and the drywall. And we don't cover cabinetry, which would mean that you may either-- if something goes wrong and your unit is severely damaged, you may either decide that you'll just get it brought back up to standard, or the corporation could maybe cut you a check as to, this is how much it would have cost it to put in shag carpet rather than your Roman marble. So you can make up the difference.
ROD ESCAYOLA: Is Roman marble really that more expensive-- much more expensive than, let's say, Greek marble?
GRAEME MCPHERSON: Well, you know what, you may actually get savings on the Roman, because it's closer a little bit. So less importation costs. So if you're looking for a cheap Mediterranean ancient look, that's your one.
ROD ESCAYOLA: Perfect. So a couple of things. It's complicated. It depends. And as Graeme just indicated, the starting point is have a look at your declaration. And that's going to give you a good indication of whether the owner's responsible or the corporation. Assuming it's the corporation, then you look into the standard unit, if there is one, because the corporation would then only be responsible up to the standard. The owner for the balance.
And you would then also look at whether or not you have an insurance deductible bylaw. Because assuming the corporation is responsible for it, then the next question is, who pays the first portion, the deductible? So wonderful. Josée, from the manager's perspective, how does that sort of play out? You're going to get-- you're going to get a call. There's a flood in my unit. What's your first question?
JOSEE DESLONGCHAMPS: Always my first question with a flood is, how are you measuring the water? You know this-- with a spoon, with a cup, with a bucket, with a bathtub. Assuming it's a bathtub and it often is, if there's an awful lot of water, the first thing you're going to do is call your insurance and put them on notice that something's going on.
Hopefully, you're familiar with your governing documents and you know all of the details about what Graeme was just talking about. But you're on the hook, too. You're going to have some work to do.
Quite often, if it's a very large claim, you reach out to your insurance. And they assign an insurance adjuster that works very closely with the manager to sort out what's what, who's who, who's paying what. Sometimes it's complicated, even by the fact that there's a tenant in the unit. So there's a third level of insurance on top of the condo, the owner, and now you have the tenant's insurance. It can be quite convoluted.
It's always a fun time. The first thing to remember always is when there's an incident and there's a report. Keep notes, keep track of everything. Make sure you have everything documented, and stay organized. But it does happen quite a bit.
ROD ESCAYOLA: Wow, that triggered a lot of questions, Josée, in the chat. Oh, how did CMG's logo appear on my slides? I guess we know which PowerPoint presentation I stole it from.
OK, next question. Nailah, we're going to turn to you. But from the number of questions we got in the chat, I think we need another episode on insurance. And, in fact, our last episode on insurance goes back to 2021. So we may want to revisit that. Nailah, can we still do virtual meetings?
NAILAH RAMSOOMAIR: So the answer here, unlike Mr. McPherson's, is very simple, because the answer here is yes, as you'll see on the screen. So, basically, what happened here was, back in April of this year of 2023, Ontario sought to introduce a bunch of changes into the Condo Act, essentially, to make it a little bit more flexible in terms of implementing virtual or hybrid meetings. And this was through this Bill 91 with a great name. It's called Less Red Tape, Stronger Economy Act.
As of June, the bill received royal assent, which means that as of October 1, 2023, the Act is going to be amended to essentially allow corporations to conduct these meetings. Oh. And to allow-- [LAUGHS] I thought I was being cut off here. I was like, is my time up-- to allow corporations to conduct these meetings virtually or have hybrid meetings and to also conduct their voting, either virtually or in hybrid form without any requirement for a bylaw to authorize that.
So right now in the Act, we have temporary provisions that are allowing for virtual and hybrid meetings. But that's all to say that as of October 1st, these are going to become permanent changes within the Condo Act. So, yes, you will be able to host virtual and hybrid meetings.
ROD ESCAYOLA: So what we've done-- and I wanted to just spring it on you, Nailah, but you've actually covered it. I've added all sorts of slides in your section. But you've covered it, right? So you'll be able to hold virtual meetings.
You'll be able to vote electronically. You've talked about that. I think one maybe that you haven't yet covered is you'll be able-- or maybe I got distracted with the phone call that came in. Corporations will be able to send notices and documents to their owners electronically.
So that's that. You covered that. I have another one here. And, by the way, we had a bit of a challenge for Nailah yesterday. I dared her to refer to the Less Red Tape, Stronger Economy Act as the Less Red Tape, Don't Touch the Green Belt Act, but she declined. She decided not to make it political again.
[LAUGHTER]
Good on you. OK, so what else have we got here? That's it. I think you've covered all of that, right?
NAILAH RAMSOOMAIR: Yeah, yeah.
ROD ESCAYOLA: What's interesting-- something that I found incredibly interesting is that voting will be allowed by electronic ballots, by phone, and by other means. And then they list the other means. And one of the means that is listed there, believe it or not, folks, is fax. The fax made it to the Less Red Tape, Stronger Economy Act. That's an old habit that you just can't shake. OK. After the webinar, Nailah, I'll explain to you what a fax used to be.
NAILAH RAMSOOMAIR: OK, thank you. [LAUGHS]
ROD ESCAYOLA: OK. So now, moving on, EV chargers. Do I need a bylaw, or do I need an EV agreement is a question that we get quite often. And the answer is a resounding you need an EV agreement.
I realize that some people out there, the other condo firm in town maybe or in your town, maybe of the view that you could do it with a bylaw. In my view, that is not the proper way of doing it. And so just so for you to keep it in mind how that works, the installation of an EV station in a parking is often, it involves often, a modification to the common elements.
And so parking spots are often unitized. But we're going to install on the wall at the back. We're going to mount a charging station or a charger. We will be installing a conduit that's going to go from your parking spot all the way to a panel somewhere that is affixed to common elements. And then there is going to be wires.
And then we're going to go all the way to the panel. And there may be an extra panel. There may be an extra breaker. There may be an extra transformer. All of these are modifications to the common elements, because you don't own the wall in your garage or the columns and so on and so forth.
Now, normally, modifications to common elements are done pursuant to Section 98 of the Condominium Act. And think that Nailah will cover that a bit later on. But in the case of EVs, the exceptions is found in the regulation. So it's not Section 98 of the Condo Act that legislates or regulates the installation of a charging station. It's either Section 24.3 or 24.4 of the General Regulation. 24.3 deals with installations made by the corporation. 24.4 deals with installation made by owners.
Now, what you often end up implementing is a hybrid model. So what we often do-- and to me, that's the one that works the best-- is the actual charger itself. You're going to put that in the 24.4 category installed by the owner for the owner. But what you're going to do for the conduit and everything else that goes all the way to your electric grid, that's going to be-- it's going to fall and be regulated by Section 24.3. So, basically, a portion of the installation is by the condo corp, and a portion is by the owner.
This allows you to split the cost in a more efficient way, where the corporation may be responsible for the infrastructure cost. And each owner who wants to opt in is responsible for their charger cost. At the end of the day, all of that is a common element, and it will likely all belong to the condo corporation, because you want the condo corporation to control it. But by splitting it in the hybrid model-- and maybe we should have another episode on that-- it allows a better way of financing it in my view.
But I'm beside the point of this lesson plan. The question that was asked of me is, do we need an agreement or a bylaw? Section 24.6 is clear. You need to have an agreement.
The agreement must be reached within 90 days, and it must be registered on title as soon as possible. The reason why some people are referring to a bylaw, there's this feeling that it's easier if we had one bylaw for the whole corporation that dealt with how do we install EV charging stations. And it would also--
They say that's the theory, anyways. It would save on the registration of EV agreements on each unit that opts in. One of the problems with that is that the only way you can truly bind future owners with respect to EV obligations is with this EV agreement that is registered on title. So again, high level. But to answer the question that was asked of me, in my view, you need an EV agreement for each owner that decides to modify their common elements.
OK, anything else? Did I miss anything? No? We're all good. I see that the questions are being answered. I do have a question for someone. And I don't know who's going to-- maybe Graeme is going to be looking at that. Where is Hogtown? We have greetings from Hogtown. I'm probably going to have to Google that.
GRAEME MCPHERSON: Hogtown.
ROD ESCAYOLA: And while Graeme is looking at that, I'm going to turn to you, Nailah, for the next lesson, which is-- oh, no, that-- that's actually Graeme.
GRAEME MCPHERSON: Oh, it's an affectionate nickname for Toronto.
ROD ESCAYOLA: OK, wonderful.
NAILAH RAMSOOMAIR: Really? Interesting.
GRAEME MCPHERSON: Our Ottawa is showing over here.
JOSEE DESLONGCHAMPS: No, no. I knew.
ROD ESCAYOLA: You did?
JOSEE DESLONGCHAMPS: I'm from Toronto.
ROD ESCAYOLA: So are you, Nailah.
NAILAH RAMSOOMAIR: Well, I [INAUDIBLE].
ROD ESCAYOLA: Yeah, but you were surprised by this.
NAILAH RAMSOOMAIR: I am. I've never heard that before. This is very interesting to me.
ROD ESCAYOLA: OK. Now, moving on to the next-- I think this is yours, Nailah. Who can modify common elements, and how is that done?
NAILAH RAMSOOMAIR: OK, so this lesson is in two sections. So who can modify common elements? Unit owner and also the corporation.
So if we start with the unit owner, basically, Section 98 of the Condo Act is going to address the steps and the procedure that you need to take in order to modify or alter a common element. So you will see that on the screen, there's A and B, two steps you have to take. First, the board must approve of the proposed change or modification by a resolution. And then after that, you have to enter into a Section 98 agreement with the corporation.
So a Section 98 agreement is essentially an agreement between the corporation and the unit owner that wants to modify or alter the common element. The agreement, essentially, is going to outline the specifics of the modification that's going to be made to the common element and also allocate responsibilities for maintenance and repair of the modified common element. That agreement is then approved by the board and then signed by the board and the unit owner and then registered on title. And then you're good to go with that modification of a common element. Second part of the lesson--
ROD ESCAYOLA: Yeah. No, don't jump in yet.
NAILAH RAMSOOMAIR: OK.
ROD ESCAYOLA: So a couple of things. So what are we talking about when we're talking about an owner modifying common elements? I'll just give a couple of examples. But whether you're painting your parking lines green, that could be a modification to common elements-- don't ask why I have that example in my mind-- or if you wanted to modify the unit door or, let's say, in a townhome setting, if you wanted to install a storm door or-- any other examples, Josée, that you can think of?
JOSEE DESLONGCHAMPS: The unit door, the unit threshold, for it to make it mobility accessible.
ROD ESCAYOLA: Yeah. If a--
GRAEME MCPHERSON: A lot of townhomes, where the yard is part of the common elements, sometimes we see people wanting to install generators, especially with all the power outages lately.
ROD ESCAYOLA: Oh, somebody is speaking from experience here. I thought you were-- I thought you were going to suggest that. And it's true as well. I mean, you're right. But another example would be if people wanted to install a deck in their common element, yard. So all sorts of examples.
And in all these cases, as Nailah indicated, you need to enter into a Section 98 agreement. And this agreement will bind this unit owner, but every future unit owner as well. OK, perfect. So second part of the lesson, what if the modification is going to be made by the corporation?
NAILAH RAMSOOMAIR: So if the corporation wants to modify a common element, there's three levels of consultation, depending on the cost of the change. And you'll see those three levels on the slide. So the first one is when there's no consultation, meaning that the proposed change that the corporation wants to make is less than $1,000 or less than 1% of the annual budgeted common expenses, if the work is required for safety purposes, or to prevent some imminent danger from happening to the property, or to comply with a mutual use agreement. So that's when there's no consultation needed.
The second one is when there's a possible consultation, when the project or the modification is more than $1,000, but then less than 10% of the budgeted common expenses. So in this case, notice must be given to unit owners. But the change is only submitted to a vote if it's requisitioned by owners of at least 15% of the registered units. So if it is submitted to a vote, then the change can only be implemented if at least 50% of the owners participating in that meeting are in favor of it.
And then lastly, there's mandatory consultation if the cost of the change is more than 10% of the annual budgeted common expenses. So this is what we call a substantial change. So notice has to be given to the unit owners. The change has to be submitted to an automatic vote. And it's only implemented if the owners of at least 66% of the units vote in favor of it. So on our blog, the Condo Adviser blog, there is actually a handy-dandy app to determine whether the common element modification is in fact a substantial change.
ROD ESCAYOLA: And how does that work? Oh, restart. OK. So this is how it would work, I guess. So if you look for the block post, "Should Condo Owners Vote on a Change to Common Element?," there's a bit of an explanation, a summary of what Nailah just presented. And then we have this beautiful app. It's a beautiful thing. And then you have to answer questions. Are you maintaining common elements? And that's going to answer one of the questions I saw, like in the chat. So are you maintaining common elements, or are you repairing them after damage?
And if you say, yes, I'm maintaining or repairing after damage, this is not a change. But if you had said no, then it brings you to the next question and so on and so forth. And it basically helps you go through these three levels of no consultation if it's maintenance to basic consultation, a change on notice, to a substantial consultation, just by answering these questions. OK.
GRAEME MCPHERSON: There was another question, just tangentially, just in chat, on the same topic that I think-- the question is, what if the project cost is over 10%, but it's going to be charged over a period of five years? And the answer for that one is, we just consider what the project costs, even if you're not incurring it all that year. So just the total cost of the project. You can't get around that requirement of any consultation by spreading the cost out.
ROD ESCAYOLA: Right. And that is, in fact, in the legislation. It specifically says that in the legislation. Although what did I see in the legislation that actually-- let me see if I can retrace my steps. I was chatting with my good friend, Jason Rivait from-- Miller Thompson. Sometimes we call each other when we have questions.
I saw something-- I won't be able to retrace my steps. Maybe I'll try to get back to that, and maybe I'll blog about it. Our blog is kind of quiet because it's the summer. OK, perfect. Anything else, Nailah, to add?
NAILAH RAMSOOMAIR: No, that's about it.
ROD ESCAYOLA: OK. Then we're going to go to the next-- oh, I keep forgetting about you, Josée, because you're too quiet. What about you, anything to add about modifications to common elements? Any sort of stories from the trenches?
JOSEE DESLONGCHAMPS: Lots of stories from the trenches. But more importantly than that, a word of warning, it's not always about the money. It's not always about how much you're going to spend. It's about the impact on your community. If you're-- sometimes you're not spending a lot of money. You're trying to take something away. We're talking about making changes where you're adding something. But what if you're taking something away that exists? It can be a substantial change as well.
So be careful about that. It's not always about the $1,000 to $10,000, 10%, all that good stuff. It's about whether or not you're changing the services and the look and the aesthetic and the feel and the-- you're changing something that is significant to the community by taking it away. Although there is no cost, it might still be a significant change or substantial change that requires a good discussion and perhaps a vote.
ROD ESCAYOLA: Yeah. You're absolutely correct. I thought we had lost you at the very end. OK, perfect. And, I guess, when it comes to the determination of whether it's a substantial change, that definition for now is strictly based on cost-- for now. We know that the Act has some provisions that have not been enacted yet that will regulate or legislate what Josée just hit on because sometimes while the Act only focuses for now on the cost, your community is going to focus on the other things, on the field, on the emotional attachment to junipers, to whatever piece of vegetation that may be out there.
And you don't want to have your corporation's name on a case. You really want to work with the community to make sure-- I mean, it is their community, too, as well, right? So you just got to keep in mind that sometimes a strict compliance with the Act is not necessarily-- well, it's important, but sometimes you need to go further than that. OK. Graeme, the liens. That's another set of questions that we get very, very often. What are covered by liens? How do we go about implementing a lien? So take it home.
GRAEME MCPHERSON: So liens. I won't get into all the things that can be done with a lien, but it's a powerful tool that essentially guarantees the corporation payment of its common expenses. It's a secured debt, and there's a whole bunch of ways it can be exercised. But what it covers is very important, because you can't just put a lien on someone's unit for any old thing. It has to be something that is covered by what's contemplated in the Condominium Act.
And so the first item I have under listed of what liens cover are common expenses, going back three months back from their due date. So that-- when we talk about common expenses here, what I'm talking about are the regular monthly payments that we make on the first of the month. A lien also covers all future common expenses going forward.
So if you register a lien in April, you'll get the April, the May, and the February's arrears. And then everything going forward. But if there was something in January, that might not be covered, because you might be outside of the three-month window.
Now, a lien also covers interest that accumulates on the outstanding arrears. And that interest rate, you can find in your corporation's bylaws, usually, bylaw number 1, the Operating Bylaw. And lastly, exciting for us lawyers, the lien covers, quote, "reasonable legal fees associated with the collection or attempted collection of the arrears," And so what that means is that if the corporation has to retain a lawyer in order to collect common expenses, which it often does for reasons I'll touch on in a moment, the idea there is that if everybody else is paying their common expenses regularly and monthly and not missing everything, it's not fair to them that they should have to contribute towards a legal bill to collect from someone who isn't making those payments. And so that's why the reasonable legal fees associated with the collection are included in the lien.
Now, it's important to note that what a lien does not cover are, A, common expenses outside the three-month window or, B, charges that are not common expenses. So I use the example of the monthly common expenses, what we pay on our regular basis. But other types of charges can be considered common expenses as well. If you owe-- if pursuant to the insurance deductible bylaw, for example, you have to pay the corporation's insurance deductible in an event of damage. That's collectible as a common expense.
Your declaration may also set out that if you are required to do some repair and you don't, in a reasonable time, and the corporation has to do it, that can be charged back as a common expense. And so your declaration in the Condo Act will set out everything that can be a common expense. I won't do an exhaustive list right now, because I don't believe there is one.
But it's important to note that there are certain things that are not common expenses. And one of the common ones we see is-- and Josée can maybe talk about this, too. But the idea of levying a fine against someone, that is something we sometimes see that's not a common expense. You can't lien for that. And the other one that's been--
ROD ESCAYOLA: Graeme, Graeme, Graeme, you can't use the F word without giving a trigger warning. Like Josée, when she heard the fine word, she was-- she got all excited here for a second.
JOSEE DESLONGCHAMPS: [INAUDIBLE] [LAUGHS]
GRAEME MCPHERSON: Well, that's why I at least warned her before. And the other common thing we see is-- let's say there's a smoking rule or a no-Airbnb-rule type of thing and someone's breaching that. One of the common questions we get is, well, can we charge back all of our legal fees and lien for it?
And there was a time, not so long ago, where condo land was more of a Wild West, and that was a pretty common practice. But there is some case law that sheds some doubt on that. There are debates in the industry about whether, if you're wording of your declaration is strong enough, you can do it.
My advice in these situations is that enforcement of the rules isn't a choice. It has to be done. If there is a rule breach going on, it has to be dealt with. And my advice to Condominium Boards, when they ask for help on this, is that you have to understand that this is an obligation. We have to enforce it.
And you may end up out of pocket for this. Enforcing the rules may just be a cost of doing business. So there are circumstances when you can get those legal fees back, if, for example, you get a court order for enforcement, then that order includes payment of the legal fees. But it's certainly not a surefire thing going into an enforcement situation that you're going to be able to recover your legal fees as a condo.
ROD ESCAYOLA: OK. So you've managed to make this entire segment without referring to the Amlani case by name. But we know what you're talking about.
GRAEME MCPHERSON: Certain cases.
ROD ESCAYOLA: Yeah, certain cases. That's right. So, Josée, I got to remind you how being in a classroom works. You have to raise your hand if you have a question. I'm looking at my notes, and I see that we've skipped you when we dealt with virtual meetings, and we skipped you when we dealt with EV agreements. So that's not-- that's not good.
JOSEE DESLONGCHAMPS: I'm feeling neglected. I Am.
ROD ESCAYOLA: I know. You got to raise your hand. So what about-- can we maybe just go back? Just briefly, I'd like to hear, maybe, your take on virtual meetings versus in-person versus hybrid meetings. Because as Nailah presented, we can continue with virtual meetings. The question may be, should we? And the question to you would be, what do people do out there? Are people now back to in-person? Are people back to, God forbid, hybrid?
JOSEE DESLONGCHAMPS: Yeah. Hybrid is so, so difficult. There are-- for the most part in our portfolio, I'm seeing most of our boards are staying with the electronic meetings they found over the last three years, that we have better participation, we have higher quorums, we have the ability to reach out to owners who never came to meetings, who couldn't come to meetings. They're away, they're non-residents, or they're traveling. They're not available, and they don't want to come and spend two or three hours sitting in a room with people. So we've reached a larger segment of our communities, and that's good.
In a lot of cases, our rooms were too small to accommodate everyone. And it was always a matter of, OK, well, you have 100 unit owners. They're all going to come with someone that's 200 people. The room accommodates 50. This is not good. Hoping they don't come. But needing that they do come, it was always a bit strange. So, yeah, too hot, too crowded, all that good stuff. And the ability to show presentations on a screen and to the AV, the Audio Visuals, is so much better through electronic meetings.
For the most part, they're staying that way. A few have tried the hybrid thing. That's so hard. That is so hard. You end up with two meetings going on at the same time, where people aren't talking to one another. And they're not hearing a-- oh, it's hard. Not my favorite thing. Perhaps we'll be able to perfect it with time, but that's not something we've done well so far. So I think for the most part, the electronic meetings are here to stay.
ROD ESCAYOLA: Yeah. I tend to agree. I'll tell you how I feel about hybrids next week, because I'm going to have my first hybrid meeting against my better advice. So we'll see-- we'll see how that goes. It's not an informal meeting, but it's a meeting where there's not going to be any votes. So we felt we could pull it off. Because to me, one of the challenges when you're doing hybrid is, how do you ensure that registration is tight and reliable? And how do you ensure that there's no duplication of votes, and that the vote is reliable?
I mean, you're going to have people that are going to vote by proxy. Some people are going to vote electronically. Some people are going to put their ballot in the shoe box. And so how do you ensure that your voting system is robust and reliable? So that to me is a big concern. So next week-- the meeting I'm going to attend next week has no vote.
And so we thought, OK, well, let's try that. OK, this is for that. How about, very quickly, Josée, going to the EV agreements, how do you-- if you just heard the bell is because it's almost supper time. Somebody's showing up for supper. So how do you tackle EV installations in your portfolio? Uh-oh.
NAILAH RAMSOOMAIR: I think we may have lost Josée and Graeme.
ROD ESCAYOLA: We did. OK, it's just you and I. OK, perfect. Well, we'll see what happens. Yeah, I would normally ask Graeme to go and fish them out, but that's not going to happen. Let's see what was the next-- are you dealing with this one, family provisions?
NAILAH RAMSOOMAIR: No, I'm not.
ROD ESCAYOLA: That was Graeme?
NAILAH RAMSOOMAIR: Yeah.
ROD ESCAYOLA: OK. Are you dealing with--
NAILAH RAMSOOMAIR: I'm dealing with the last slide, Who Can Chair our AGM?
ROD ESCAYOLA: OK. So start with that, and I'll see if I can find a way to recover these two, who are skipping class right now.
NAILAH RAMSOOMAIR: OK. We're at the last lesson. We're jumping around a bit. So this is Who Can Chair our AGM? So for most other condo topics, the answer is in the Condo Act. But for this specific topic, the Condo Act does not provide any information on who can share an AGM. So in this case, the place that you're going to find this answer is in your Operating Bylaw.
So if you go to your Operating Bylaw, you're either going to find this answer in two places. The first place is going to be either under the section that deals with meeting of owners or another section which deals with the duties and responsibilities of a president, a vice president, et cetera. So you'll see two examples that I have on the screen here. I fished them out from two different Operating Bylaws. In both these examples, this information was found under the duties and responsibilities of the president and the vice president.
And you'll see that the language here is going to essentially tell you who can share the meeting, what happens in the case of an absence, and/or the delegation of that power. So if we look at the first example here, you see under Section 7.04 the president. The president can essentially chair the meeting. But if we continue to 7.05 of our example 1, it basically says, when the president is absent, the vice president is going to assume their role, and they're going to be able to be chair.
The difference is, if we look at the second Operating Bylaw that we have here, the language is slightly different. Because you'll see, when president-- the president shall, when present, be the chairperson at all meetings of the Board and of the owners or designate the chairperson at all such meetings. So you see here, there's a designation language within the second Operating Bylaw.
So the difference is, in the first bylaw, the only people that can be chair here are president or vice president, in the case that the president is absent. There's no ability to delegate here, whereas, that ability exists within the language of the second Operating Bylaw. So in that case, in the Operating Bylaw number 1, it's going to essentially move to a meeting-- a vote of the owners, if the president or the vice president are absent, because that delegation language is not present. So in this case, it's important to look at that language within your Operating Bylaw in determining who can be chair.
ROD ESCAYOLA: OK, wonderful. This is great. Great info. And in the meantime, I was scrambling. And I managed to get the Graeme back on the line on the phone. And I'm trying to fish Josée. And you know what happened, folks? I guess there's a major power outage in Orleans, where the two of them live.
JOSEE DESLONGCHAMPS: Hello.
ROD ESCAYOLA: Hello. Hello, Josée. And hello, Graeme.
GRAEME MCPHERSON: Did you lose Josée as well?
ROD ESCAYOLA: Yeah, the two of you.
JOSEE DESLONGCHAMPS: No. That's an odd coincidence.
ROD ESCAYOLA: Well, think it has to do with the power. You're probably on the same power grid. And, Josée, let me tell you why you lost power. You lost power because Graeme had to change his AC this morning. And I think he probably went for a-- I don't know. I don't know if you did it yourself, Graeme. I don't know what happened there.
GRAEME MCPHERSON: Yeah. And I went for the [INAUDIBLE] build. So they said that this is not sustainable, and it's going to cause major power failures. But you got to do it. Oh! My gosh.
ROD ESCAYOLA: You got to do what you got to do. OK. Graeme, are you ready to go for the next one? Are you covering the single family provision and whether or not they can prevent the short-term rentals?
GRAEME MCPHERSON: Yes, I'll do it remotely. My power just came back on. But at this point, I think we've got a-- the show must go on. And so I'll do it remotely. I'm going to assume all of the comments in the chat are, where's that handsome guy gone?
ROD ESCAYOLA: You're right. You're right. You can read their minds.
JOSEE DESLONGCHAMPS: My power is back. I'll be back in a minute.
ROD ESCAYOLA: OK.
GRAEME MCPHERSON: So single family provision in a declaration is a pretty common thing we see. The declarations of a lot of condominiums will have a phrase that basically says, the units are to be used as single family-- as single family residential units, and no other use is permitted. Something along that language.
And so the question we run into a lot and that actually has been explored by the court is, if you have language like that in your declaration and it doesn't go any further, it doesn't say anything else, does that mean that something like Airbnb or short-term rentals is permitted? Are you allowed to do that if your units are to be only used as single family residences? And the courts have weighed in on this. And I don't have the quote in front of me. But I believe there's a quote on the screen. And--
ROD ESCAYOLA: Actually, I can read it for you. So, basically, it says that, "Single family use cannot be interpreted to include one's operation of a hotel-like business, with units being offered to complete strangers on the internet, on a repeated basis, for duration as short as a single night. A single family use is incompatible with the concept of check in and check out time and cancelation policies and security deposits and cleaning fees, et cetera, et cetera." So that was the good Justice Baldwin, who wrote that in 2016. Yeah.
GRAEME MCPHERSON: But the point being that on its own, a single family or-- yeah, a single family residence provision in your declaration would be sufficient to prohibit something like short-term rentals on a hoteling type basis. Now, there are other factors that may be at play. For example, if your declaration goes on to talk about the idea that-- yeah, you can lease your unit for a week or so. Then in that circumstance, if the declaration goes on to talk about short-term rentals and implicitly allowing it, then-- I mean, we're in a different scenario. Likewise, it may be that the declaration puts certain definitions or rules around what it means by single family provisions.
So again, as I've been doing all evening, you have to check what your governing documents say. But assuming your declaration doesn't explicitly contradict that, something that can be useful is adopting a short-term residence rule rather than just relying on the single family provision in your declaration. And the reason being is that with a rule, you can get much more specific, it's much less open to interpretation, you can set very concrete and easy-to-understand parameters about what's allowed and what's not allowed.
And something we often get asked is, well, if it's in the declaration and then we have it in a rule, is the rule somehow less enforceable or less impactful than the declaration? And it's not. Both are just as enforceable as one another.
The only thing you have to make sure is that your rule doesn't contradict the declaration or do something that the declaration specifically says is not allowed. But that's one method we recommend, usually, if you want to have a little more control over what the rule is or what is allowed and what's not allowed. A rule can often be much more helpful than just kind of that one off line that's found in many declarations.
ROD ESCAYOLA: Thank you for that. I'm going to move us all to your next installment, Graeme, because we're going to run out of time. Just for everybody to know at home, whenever I come up with an agenda, I try to-- I put too much. It's just like you go to the buffet and you put too much stuff on your plate. And every single time, the voice of reason, Graeme, tells me, that's too much. We're not going to be able to cover this in an hour. He was right again. So we're going to skip a lesson here. Actually, we're skipping two.
But I'm going to bring you back to the microphone, Graeme, with a quick summary of what kind of disputes we can bring to the CAT, because there's all sorts of-- I see all sorts of blog posts out there that there seems to be maybe some movement. I'm not too sure. So what kind of a-- and you don't have the slide in front of you. So you're kind of flying on instruments here. But what kind of disputes--
GRAEME MCPHERSON: I wanted to know if I really have it memorized.
ROD ESCAYOLA: So go ahead.
GRAEME MCPHERSON: So the CAT, or the Condominium Authority Tribunal-- I'm sorry that I'm missing out on this slide, because I did have a cute cat on it. But this is a tribunal that's been set up to help streamline a lot of common issues faced by condominiums. The idea being that it's a faster, more efficient cheaper process.
But right now, its jurisdiction is limited to certain types of disputes. The original one that it was first opened dealing with were disputes about records requests and whether or not the corporation was keeping adequate records. And that remains probably one of its-- still one of its biggest uses.
However, it has expanded its jurisdiction, rolling out new things periodically. And so now, its jurisdiction also covers disputes with respect to pets, parking, or storage. It also covers disputes with respect to nuisance.
So we can see in those categories, there's a lot of common issues that are going to come up in any setting where there's a community living in an enclosed-- a close space together. Nuisance can include sound. It can include smell. It can include smoke. Pets are often an issue in residential condominiums. Parking can cause problems. Sometimes the truck is just too big.
And so the other important aspect of these jurisdictional avenues that the CAT has is that it also covers issues with respect to chargebacks about those. So that means that if there are a whole bunch of legal fees incurred dealing with some sort of, let's say, parking dispute and those are-- the corporation is attempting to charge those back to the owner, that debate is also within the CAT's jurisdiction as well. As of right now, that's where the jurisdiction ends.
Will it expand? Only time will tell. But if we take what's happened in the past as any indication of what's going to happen in the future, it seems as though the jurisdiction is continuing to grow.
ROD ESCAYOLA: OK, wonderful. It's now seven minutes. We have seven minutes to go. I see that some people now got tired of being ignored in the chat room or in the Q&A. So they've actually raised their hands. And oddly enough, under this topic. One of the things I wanted to say very briefly is that one of the expansion of jurisdiction that we see, and I'm not sure I entirely agree with it, is whether or not harassment constitutes a form of nuisance.
And there's at least two decisions out there at the CAT that have accepted that premise or that principle that harassment is a form of nuisance. I don't agree at law. They're not the same. But I also question something else.
And it's the CAT's ability to rule on it, even if it was, in fact, a nuisance, because the jurisdiction of the CAT with respect to nuisances is limited to nuisances that have been listed in the regulation or in the Act. It says prescribed nuisance, such as smoke, odor-- noise is not a prescribed one but it is one. And so harassment is not one of those. But there seems to be a bit of a door that the CAT is opening, and we'll have to see where that goes.
I want to do something before I run out of time, and it's-- let's have a quick survey, very, very quick survey here. So, unfortunately, I'm going to lower the hands that we have that are up. And I'm sorry about that. But what I'm going to do is, we are going to ask you with a show of hand, whether I'm going to run the various topics we covered today to see which ones we should have a whole webinar episode on, because I've seen more questions today than I've seen in any other recent webinar.
So let's go over the topics that we have with a show of hand. Should we cover-- have a full episode on EV stations and agreements? So raise your hands. We see the hands are going up. And we're at 40 out of 90.
OK, what about if we now ask you a different one? I'm going to ask you this one now, which is, what about insurance and who's responsible to repair after damage, and what insurance is required? So another insurance episode. What do we got? Oh. Never underestimate that good insurance episode. So we're at 48 out of 90.
OK, what's the next ones that we covered today? Let me go back to my agenda. How about virtual meetings and hybrid meetings? Let's see. Do we want another episode on virtual/hybrid meetings and how they're done and how that works and-- yeah, I think we kind of flogged that one to death way back when, eh? OK, so not a popular one.
GRAEME MCPHERSON: That was may be on its last breath.
ROD ESCAYOLA: Yeah. So sorry, Nailah, you had the boring topic. But you really delivered it very well. Let's see what else we got. Who can modify common elements? Raise your hand if you think that the modifications to common elements-- if that's a topic worth exploring. Less it seems, but we're at 30 out of 90.
And then what's the next one? We have this single family provisions and other rental restrictions in the condo setting. So another rental/tenant kind-of-thing episode. Let's see what we got. We had a recent one, recent-ish one. So maybe it's going to be less popular. Well, 30 out of 90 are suckers for punishment. They want it again. Perfect. OK, that's good.
I wanted to have this-- well, we might as well cover the CAT's jurisdiction and important recent cases at the CAT. Is that something-- should we have a good old case law fest? OK, so we're at 30, 40, 45. Oh, [INAUDIBLE]? So the most popular one--
GRAEME MCPHERSON: [INAUDIBLE] is genuinely shocked, because it goes French.
ROD ESCAYOLA: What was that?
GRAEME MCPHERSON: You can tell when you are genuinely shocked, because you default to French.
ROD ESCAYOLA: That's true. [LAUGHS] That's true, yes. So I'm surprised, yeah. OK, perfect. And I'm not going to ask the question, who's your favorite condo cousin yet, with a show of hand. We're going to save that for later when you get to know Nailah a bit more OK, fantastic. We got one minute left, folks.
And so I'm just going to go around the table. I'm going to do my usual-- if you have parting words before we part, obviously. So, Josée-- Josée Deslongchamps, with the Condo Management Group, a very senior experience but the friendliest of condo managers in Ottawa, thank you so much for attending. And, sorry, I kind of skipped over you a couple of times. We'll have to fix that.
JOSEE DESLONGCHAMPS: I'd have to leave, as you could see. My God.
ROD ESCAYOLA: I thought it was at a protest, actually.
JOSEE DESLONGCHAMPS: I left in a huff, but I'm back.
ROD ESCAYOLA: Perfect. And, Josée, any parting words for this year? The year ahead of us?
JOSEE DESLONGCHAMPS: It's getting old, and it's getting boring. But my parting words are always the same. Be nice to one another. Be fair with one another. Look to see what's really happening. Listen to hear-- hear to listen, really listen. Be nice. Keep your sense of humor, and just do your best.
ROD ESCAYOLA: Wonderful. That reminds me of your "Ask not what the condo can do for you. Ask what you can do for your condo" speech. Was that from you?
JOSEE DESLONGCHAMPS: Yes. Yes, it was.
[LAUGHTER]
ROD ESCAYOLA: Nailah, parting words. What are we looking forward to this season?
NAILAH RAMSOOMAIR: Drinking my liter of water per day.
ROD ESCAYOLA: Wonderful. We'll keep you honest. We'll keep a tab on that. Thank you so much, Nailah. What about you, Graeme? Have we lost it?
GRAEME MCPHERSON: Well, my power failure today is a living testament to the, perhaps, value of a generator. So if you are in a scenario where your board is prepared to consider such a thing, make sure you follow section 98 of the Act. But I consider it, because it booted me out of the Zoom today.
ROD ESCAYOLA: Look at that. Isn't that iro-- the irony of the whole thing-- he-- when I asked, give us an example of a modification to come in common element, well, maybe some people want a generator. So, folks, we're going to start a GoFundMe page for the Graeme to get a generator going in Orleans. And, hopefully, we--
GRAEME MCPHERSON: --garner lots of sympathy.
ROD ESCAYOLA: And maybe we can stretch a power cord all the way to Josée's abode, which is likely in the same neighborhood-ish.
JOSEE DESLONGCHAMPS: We're not far from one another. So it can't be long there, Graeme.
GRAEME MCPHERSON: Yeah, yeah. I mean, fair enough. Maybe we can make this thing happen.
JOSEE DESLONGCHAMPS: [LAUGHS]
ROD ESCAYOLA: So thank you, everybody. Thank you so much for joining us tonight. It was a fun one, fun to put together, fun to see the various questions. And to see how-- oh, yes. Wednesday, October 10th is actually the 11th. OK, so it's going to be the 11th, I think. The reason is because we can't have one the first week. So it is the 11th. Thank you so much, Brian.
So it's going to be the 11th of October, and that's going to be our next webinar. A topic to be determined, but I think it's going to be either insurance or the CAT. And so that's it. You'll need to register again. To register, you will find the link on your favorite condo blog, which is at the webinar tab. And if you click on that, it's going to allow you to register for the next webinar.
OK. So thank you very much, everybody. Thanks for sticking around an extra two minutes. Time to have supper, and we'll see you on October 11th. Ignore what the slide says. It's going to be October 11th. Thanks so much. Have a great evening
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Bye, everyone.
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