Canada: Condo Bylaws Must Grant Authority To Issue Fines

Last Updated: April 7 2016
Article by Robert Noce

Q: Recently, our condo board distributed a 15-page booklet to each owner, called "Information Booklet and Condo Policies." It contains a repeat of some bylaws, as well as some new rules. For example, it states that we are not allowed to feed birds or install bird feeders, and outdoor clotheslines are not allowed. If an owner contravenes any of these rules, they may be subject to a fine. However, our bylaws state that the condominium corporation may only collect a fine if damage has occurred. Does the condo board have the right to impose rules plus bylaws?

A: The ability to issue a fine must come from the bylaws. If your bylaws do not give you the ability to issue a fine for a particular infraction, then the board cannot implement a set of rules to get around that deficiency in the bylaws. There is nothing preventing a board from passing rules to give people additional guidance in terms of how they are to live and operate in the building. However, you cannot pass a rule to avoid the need for amending your bylaws. You may want to seek a legal opinion as to whether the fine component of the rules is even enforceable.

Helpful Hint: Rules and regulations are common in condominium living in Alberta. However, rules and regulations cannot take away or add powers to the board or condominium corporation that would normally be found in a set of bylaws. You cannot do indirectly what the law requires you to do directly.

Q: I own a condo unit. The original developer finished two phases of our fourphase project in 2012, then went bankrupt. Another owner bought the unfinished plans and land in 2012 and did nothing, then sold it to a new developer in 2014. At our most recent annual general meeting (AGM), the new developer had over 48 per cent of the vote. The new developer is currently building the foundations for phases 3 and 4, but has not completed any units yet. At our most recent AGM, a representative of the new developer voted as 48 per cent of the unit factors, so none of the owners' resolutions passed and the incumbent board was elected. Is it legal for the developer to vote for 48 per cent of the unit factors?

A: Yes; notwithstanding the fact that the owner has not developed phases 3 and 4, it still has an ownership position and the unit factors for the undeveloped lands. That is why it is so important to take the time, as a potential purchaser, to make sure that the development will occur over a period of time that you are comfortable with, and that you won't be looking at a piece of dirt for an extended period of time. As well, you need to look at the Condominium Additional Document Sheet to determine whether or not it truly is a phased development.

The fact that your condominium complex is built over time may not necessarily mean that it is truly a phased development, which has a specific definition and rules for compliance under the Condominium Property Act.

Helpful Hint: When a group of owners finds that it is difficult to get an answer or control the board, there is nothing preventing the owners from coming together and retaining legal counsel to help them with this particular issue.

Q: Can a small group of owners buy up the debt of several other owners — for example, due to their inability to pay a special assessment — and take over their voting rights? Furthermore, is it possible to un-incorporate the condominium?

A: There is nothing in law preventing someone agreeing to pay someone else's debt. The terms and conditions of paying that debt would be an issue between you and the person that owes the money to the condominium corporation. This would not be an issue of the condominium corporation. In other words, if you pay someone's outstanding condo fees and in return, the owner gives you their proxy until the debt is repaid, I see nothing wrong with that, and that would be an issue between yourself and the person who owes the money to the condominium corporation. With respect to "un-incorporating the condominium corporation," the answer is yes. However, the steps are significant and would require a court application.

Helpful Hint: People are free to enter into agreements at any time, provided that the agreements are legal and are not against public policy.

Q: I live in a duplex-style bare land condo with 38 units. When the complex was built, the builders set the condo fees equal for all units, regardless of the unit factors. Now, some board members are realizing that this is not fair. We have been told by our property management company that we must have 75 per cent of the unit owners in favour of making the change to charging by unit factors. Unfortunately, the majority of units are the ones with the higher unit factors and do no want their fees to go up. Is this correct?

A: First, you need to review your bylaws. The Condominium Property Act clearly states that condo fees must be in proportion to the unit factors of the owners' respective units, or if provided for in the bylaws, on a basis other than in proportion to the unit factors of the owners' respective units. If your bylaws do not give the condominium corporation the power to levy condo fees equally for all units, regardless of unit factors, then the process is illegal. As well, subject to your bylaws, normally the board would have the ability to prepare a budget for the upcoming year and determine the amount of condo fees that each owner would pay on a monthly basis to meet the needs of the condominium, as per their budget. Therefore, I would suggest that the ability and power to set condo fees is that of the board and not the owners. If, however, your bylaws have given the power to the owners, then your property management company may be correct.

Helpful Hint: I find it odd that no one was aware of this issue when they bought into this condominium building. That would have been something that I would have looked at, and if I found the process to be unfair, I would not have bought into the complex.

Q: For the past three months, the showerhead in my unit goes from super hot to ice cold in a second. For me, as a senior, this is quite dangerous. I have told the property management company about this, and their response is that it is a 40-year-old building and there is nothing that can be done. What can I do?

A: I am sorry to hear that. I am also surprised and disappointed that they would treat a senior in this fashion. I understand that the building is old and it probably requires some major improvements. Therefore, what I would suggest is that you call a meeting of the owners and get the owners to direct the board to fix this problem. If other people are facing the same problem, there may be a desire on the part of all of the owners to spend the money to fix this plumbing problem. You may also want to contact Alberta Health Services to see if there is anything they can do in that regard. Unfortunately, you will have to take steps to get this problem fixed.

Helpful Hint: If many owners are facing the same problem, the best solution would be to get the owners to come together to find a solution.

Previously published in 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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Robert Noce
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