Q: I am a condo board member. One unit owner is
more than nine months in arrears of condo fees, totalling about
$3,000. We have filed a new caveat on title; this is the second
caveat in 15 months. In the first case, the arrears were paid and
the account brought to a nil balance in May 2013. Since then, only
two months of condo fees have been paid. Furthermore, the City has
informed our board that the 2013 municipal taxes have not been
paid. The owner has not returned phone calls or replied to letters
from our management company. Our board is at a loss. How can we
recover the monies owed to the condominium corporation?
A: First, you may want to consider writing a
letter to the owner's mortgage company/bank to advise them that
the owner is in arrears with respect to condominium fees. Usually,
the mortgage company/bank will pay the arrears, as failing to pay
your condominium fees is a breach of your mortgage agreement. After
the mortgage company/bank pays the arrears, the mortgage
company/bank will probably commence a foreclosure action against
the owner. If that fails, the condominium corporation may consider
beginning its own foreclosure action against the owner. Under the
Condominium Property Act, condominium corporations have the same
power as banks do with respect to foreclosure. The power is
extraordinary and should be used in these types of scenarios.
Helpful hint: Sometimes, owners simply feel
that they are under no obligation to pay condominium fees.
Therefore, it is important that condominium corporations take a
progressive and active role in enforcement, which sends a strong
message to delinquent owners. If you are an owner in condo fee
arrears, the worst thing you can do is hide; it is far better to
communicate with your condo board and arrange a debt repayment
schedule, or perhaps you need to get a second part-time job
temporarily, or maybe even downsize your property if you cannot
meet your monthly expenses.
Q: A few years ago, our condo fees were raised,
and then recently raised again. We now pay $710 per month, even
though there is a lot of money in the reserve fund. The board has
been doing regular upgrades, such as replacing carpet, which we
feel are unnecessary. Is there a way to scale our condo fees back
A: Every year, boards are required to prepare
an annual budget which is then presented to the owners to deal with
the expected revenues and expenditures for the year. I cannot tell
you that your condo fees should be reduced because I have no
information about your condominium's budget. My suggestion is
for you to review the budget and financial statements of the
condominium corporation and determine whether or not the
corporation is collecting excess funds. As well, if you feel some
of the expenditures that are being budgeted for are not needed,
then you can raise these issues at the annual general meeting. You
may also want to consider running for a board position so that you
can be a part of the process and be engaged so as to understand why
your condominium fees are so high.
Helpful hint: Just because your condo fees are
high, that doesn't necessarily mean that the board is spending
money unwisely. It is important that boards prepare a proper budget
and collect monthly fees to cover the ongoing expenses of the
condominium corporation. There is no prize at the end of the year
for having the lowest condominium fees in Alberta.
Q: My condominium board has issued a $25,000
special assessment, to be paid over a three-year span, for work yet
to be done. Is there any way to get them to extend the payment term
to five years?
A: You could write a letter asking the board to
extend the time of payment from three to five years. I suspect,
however, that the board has a clear reason for wanting the money in
place within three years. One would have to look at the report and
other materials that the board relied on when it made its decision.
My best suggestion is for you to ask the board for an explanation
as to why you could not extend the time period from three to five
Helpful hint: Boards make decisions based on
the best information available to them at the time. Boards should
retain professionals to assist them in the decision making process.
However, sometimes boards don't consider other options and it
is incumbent on owners to suggest alternatives.
Originally published by The Edmonton Journal.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Russell v. Township of Georgian Bay provides a useful reminder of the fact that while municipal officials sometimes appear to hold all of the cards in disputes with home owners, that is not always the case.
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