Legal

May 16, 2019 Published by British Columbia Chapter - By Lisa Frey

Civil Resolution Tribunal Updates

From CCI Vancouver Condo News, Spring Issue 2019

The Owners. Strata Plan VR1973 v. D. E. Pezzot Inc. et al, 2019 BCCRT 747

Many British Columbians are unaware that their duplexes are actually governed by the Strata Property Act, even though there are only two units, and some of the resulting issues that could arise in one. This complex was a great example of what is often referred to colloquially as a "nonconforming strata",

This dispute involved an older, two-unit strata corporation in Vancouver. In the summer of 2016, the strata lot 2 (“SL2”) owner approved the installation of wiring servicing on the south exterior wall of the building outside SL2. The owner of strata lot 1 (“SL1”) was concerned about how the wiring had been installed and requested that the owner of SL2 fix up the siding around the works so the building could be washed.

Frustrated when the SL2 had not yet repaired the siding by Fall 2017, the SL1 owner wrote on behalf of the strata corporation indicating that the damage to the siding was contrary to bylaw 3(2) which states, among other things, an owner must not cause damage to the common property. The parties obtained independent reports which presented conflicting views on whether the wiring installation caused damage to the siding. The SL1 owner then commenced an action at the CRT on behalf of the strata corporation.

Since there had never been a council election properly conducted at the strata corporation and no president had been elected, there was no tie breaking vote for either respondent, and the strata council could not have acted by majority (i.e. 50% + 1) in bringing the claim against the SL2 owner. The tribunal chair suggested that the SL1 owner should be bringing the claim in her own right, rather than on behalf of the strata corporation, and the SL2 owner agreed; however, she declined to amend her claim to bring it in her personal capacity, arguing that the SL2 owner had consented to having the action brought by the strata.

Since the SL1 owner was acting unilaterally without the necessary authority to bring the claim on behalf of the strata, the claim was dismissed on the grounds of section 11(1)(c) of the Civil Resolution Tribunal Act: "issues in the claim or the dispute are too complex for the dispute resolution process of the tribunal or otherwise impractical for the tribunal to case manage or resolve". The CRT also declined to consider any of the substantive issues in the case.

This decision raises two important points:

1. starting or continuing a dispute improperly can result in the CRT refusing to consider the issues you have raised; and
2. when living in a non-conforming strata, it is prudent to consider issues of how dispute resolution will work prior to conflict arising, as the strata council will be not be able to function without a majority vote (which can be extremely challenging to achieve in a small strata, especially once a dispute has arisen).

Thinking ahead about these issues can save a lot of headache down the line.

O'Brian v. The Owners, Strata Plan BCS 2550, 2019 BCCRT 721

This decision explores the subtle differences in bylaw drafting that can have an effect on whether a strata corporation can charge common property damage back to an owner or tenant, as the case may be.

In this situation, an owner accidentally dropped a plane of glass in the elevator, and the strata determined that broken glass then went on to damage the elevator. It attempted to charge back the tenant for the repair costs to the elevator, which were approximately $1,500.

Upon careful examination of the use of property bylaw which the strata relied on to impose the charge back, the CRT found that it clearly differentiated between where a tenant is liable to the strata for damage to common property, and where an owner is liable. Only one subsection of the bylaw required that a tenant pay the strata for damage, and it dealt specifically with marking or defacing of interior or exterior walls or floors - which was not the nature of the damage that occurred (which was to the elevator piston and vacuum seal).

The other bylaws allowed the strata to pursue the owner, but not the tenant. Since there was no express provision in the bylaws, or the Strata Property Act, allowing the strata to pursue a tenant in these circumstances, the charge back was reversed.

Whether the strata corporation deliberately intended that tenants would only be charged back in limited circumstances when it drafted bylaw 3(2) is not clear from the CRT decision. However, in any event, this decision illustrates how easy it would be for a strata corporation to unintentionally draft an incomplete chargeback mechanism while appearing to have a fulsome framework set out in its bylaws. In this case, adding in details about the type of damage that a tenant would be charged back for was interpreted by the CRT to exclude other types of damage. It is therefore advisable to review one’s chargeback bylaw from time to time to confirm that it is sufficiently broad for the strata’s purposes and that the strata has the power to recover its expenses from all intended parties.

Lisa Frey is a real estate lawyer with Lawson Lundell LLP. Her practice focuses on condominium development, strata governance matters, such as drafting bylaws and resolutions, and a wide variety of commercial real estate transactions. She has been a CCI Vancouver Chapter member since 2014 and is passionate about strata education.

Lawson Lundell, LLP
Lisa Frey
Tel: (604) 631-9139
www.lawsonlundell.com
lfrey@lawsonlundell.com