Legal
August 13, 2024 Published by CCI National - By Armand Conant
CCI-N Primer: Canadian Condominium Legislation – A Coast to Coast Comparison - 2024
This is the 6th Edition of CCI National’s Primer. As mentioned in earlier editions, given the diversity of condominium legislation and regulation across Canada, CCI National believed that it would be helpful to publish a short overview of some of the more basic aspects of the statutes and regulations from each of the provinces and territories.
Foreword to the 2024 Edition
By: The Government Relations Committee of CCI National Armand Conant – Project Leader
This is the 6th Edition of CCI National’s Primer. As mentioned in earlier editions, given the diversity of condominium legislation and regulation across Canada, CCI National believed that it would be helpful to publish a short overview of some of the more basic aspects of the statutes and regulations from each of the provinces and territories.
As any form of substantive comparison of all the governing legislation and regulation across Canada would be an enormous task, it was decided that the Primer would be brief, very general, and not involve substantive analysis. The goal of the Primer is to provide an educational reference that National Directors may use to familiarize themselves with the legislative frameworks of condominium legislation across Canada. It is a starting point to give you a flavour of the legislation.
CCI National’s Government Relations Committee prepared the first edition of the Primer in 2006, with subsequent editions over the years, with the last being in 2020. Given the degree of legislative changes that have occurred since 2020, the committee felt that an update was appropriate. We have focused on the more significant points in each jurisdiction’s condominium framework. To the extent possible, in each section, the jurisdictions that have similar laws are discussed as a group with differences noted where applicable.
We have tried our best to understand each statute and accurately state its provisions, but we caution that, despite our efforts, mistakes or misinterpretations may occur. This Primer is not intended to constitute or be relied upon as legal advice or as a substitute for obtaining such advice. CCI disclaims any responsibility for the Primer’s accuracy or completeness or for any harm arising from reliance on this Primer.
We would like to thank Armand Conant of the law firm Shibley Righton LLP, who headed up this project and has been responsible for all six editions, Jessica Hoffman and Rabab Meen, condominium lawyers with Shibley Righton, who assisted with the research and drafting of this. We also thank all those across Canada who took time out of their busy schedules to review drafts of this Primer, including, Jamie Bleay, Anand Sharma, Dan Nielsen, Andrew Fulcher, Jeff Campbell, Donna Singbeil, Alan Forbes, Doug Forbes, Armand Conant, Patricia Elia, Nancy Houle, Susan Corey, Dan Campbell, Geoffrey Penney, and many others.
The legislation and regulations referred to in this edition are current as of December 31, 2023.
Table of Contents
1. Introduction
2. Creation of the Condominium
(a) Name of Legal Entity
(b) Declaration and Description
(c) Common Elements
(d) Unit
(e) By-laws
3. Rights and Obligations of the Corporation
(a) Governance of the Corporation – The Board of Directors
(b) Standard of Conduct of Directors
(c) Rules
(d) Enforcement
(e) Repair and Maintenance
(f) Reserve Fund
(g) Common Expenses Lien
(h) Management
(i) Auditing
(j) Insurance
(k) Status Certificate
(l) Communication to Owners – Information Certificates
(m) Condominium Authority of Ontario (CAO) - Annual Filing and Notice of Change
4. Rights and Obligations of the Owners and Mortgagees
(a) Contribution to Common Expenses
(b) Annual General Meeting
(c) Leasing of Units
(d) Mortgagee’s Rights
(i) Right to Vote
(ii) Right to Collect Common Expenses
(e) Amending the Declaration or Description
(a) Mediation and Arbitration
(b) Oppression Remedies
(a) Forms of Condominium Corporations
(b) Disclosure Statement
(c) Shared Facilities
(d) Amalgamation of Corporations
Appendix - Table of Legislation
1. Introduction
Condominium legislation across Canada shares many common features. All Canadian provinces and territories have enacted legislation setting out the rights and obligations of condominium owners and residents, developers, and condominium corporations, as well as the rights of prospective condominium purchasers. All condominium laws are based on a similar framework: condominiums as shared ownership of real estate, typically consisting of individual units and common elements, with owners having exclusive ownership of their individual units, a percentage of shared ownership of the common elements, and a right of access to and use of the common elements. Further, all Canadian condominium laws are based on the premise that establishing a condominium creates a new legal entity, the condominium/strata corporation, which governs the condominium’s affairs.
In the following sections, we explain and compare some of the key concepts in condominium legislation across Canada.
In December 2015, Ontario gave Royal Assent to Bill 106 (Protecting Condominium Owners Act, 2015), which significantly reformed its existing legislation, including the governance of condominium property, creating a new tribunal for dispute resolution (with a significant online capability); along with introducing new legislation for the licensing and regulation of condominium property managers. Only a portion of these reforms have been proclaimed into law effective November 1, 2017, but they include the creation of the Condominium Authority of Ontario, the Condominium Authority Tribunal and the mandatory licensing of condominium property managers through the creation of the Condominium Managers Regulatory authority of Ontario.
British Columbia also has an online dispute resolution tribunal dealing with condominiums and residential landlord/tenant disputes.
This 6th edition of the Primer will refer to legislation in the various jurisdictions as of December 31, 2023, and only the proclaimed portions of Ontario reforms. We will not refer to the other proposed reforms to Ontario’s legislation as we do not know when any of them will be proclaimed.
2. Creation of the Condominium
(a) Name of Legal Entity
All provinces and territories, except Quebec and British Columbia, use the term “condominium corporation,” or simply “corporation,” for the legal entity that is the condominium.
British Columbia refers to a condominium corporation as a “strata corporation.” In Quebec, the condominium corporation is referred to as a “syndicate,” or “syndicate of co-owners.” Nonetheless, the syndicate, like condominium corporations elsewhere in Canada, is considered a distinct legal entity.
Notwithstanding these minor differences in legal terminology for the legal entity, in both British Columbia and Quebec, the term “condominium” is commonly used to refer to the corresponding building or real estate. For the purposes of this Primer, we will use either the term “corporation” or “condominium”.
The Governing Documents of the Condominium
In every jurisdiction, the condominium is governed by a hierarchy of documents, generally consisting of the Declaration, By-laws, and Rules.
The declaration governs the most fundamental matters and has the highest threshold for amendments. The by-laws govern many aspects of the condominium, including procedures and finances, and have a modestly high threshold for enacting and amendment. The rules govern day-to-day activities within the condominium and have the lowest threshold for enactment and amendment. Which matters are to be included in each of these documents will vary from jurisdiction to jurisdiction.
For example, in Ontario, a by-law may be held invalid if it does not fall within the limits of such subject matter, such as where it deals with a matter which under the legislation must be passed by way of a rule instead. In the Atlantic provinces, rules can only apply to common elements and cannot deal with anything within the unit or ownership of the unit.
(b) Declaration and Description
Generally, in all Canadian jurisdictions, a condominium/strata corporation is created by the registration with the land registry office of the corporation’s constituting document, the “declaration”, and the condominium’s legal description or plan. Alberta, British Columbia, and Saskatchewan treat the declaration and description as a single document, referred to as the condominium “plan”. The term “declaration” is not used in these provinces with reference to the condominium plan.
This filing has two effects: the ownership of the land is converted from freehold to condominium with defined units capable of separate ownership, and the condominium is created as a legal entity to manage the condominium on behalf of the unit owners. The person filing the declaration, typically the condominium developer, is often called the declarant (or, in Quebec, the promoter).
The declaration and description are often in a standard form set out by regulation. Some jurisdictions also permit or require the declaration to contain or be accompanied by the by-laws, any provisions regarding the use of the units or common elements, the responsibilities of the corporation and unit owners, or other similar matters.
A description or plan contains survey plans describing the corporation's boundaries, units and common elements. Some jurisdictions also require a certificate from an architect and/or engineer stating that the buildings have been constructed according to regulations.
Each jurisdiction sets out a procedure for the amendment of the declaration or plan; typically approved by the owners, either by a vote of owners with a high approval threshold, or as is the case in Ontario, by the signed consent of either 80% or 90% of the owners, depending on the nature of the amendment (in Ontario there is no vote by the owners, but rather the signed consent), and then the amendment is registered on title.
(c) Common Elements
The existence of common elements is a basic characteristic of any condominium. In most Canadian jurisdictions, the term “common elements” (in Quebec, “common portions”; in Saskatchewan and Alberta, “common property”) refers to all the property of the condominium that is not the individual units; that is, those sections that are for the common use of all unit owners, or that are not assets owned by the corporation itself (for example, a superintendent’s suite). It is important to understand that the common elements are not owned by the condominium corporation; they are owned by the owners of the units as tenants-in-common. The interest of each unit owner in the common elements and assets is the percentage amount set out in the condominium’s declaration (or condominium plan in those provinces that do not refer to a declaration).
(d) Unit
In most jurisdictions, the areas within the condominium building or property individually owned by each condominium unit owner (and registered on title by way of a transfer or deed) are referred to as “units.” The boundaries of each unit will be legally defined in the condominium’s declaration and description or plan. Some jurisdictions specify that the unit includes, in addition to the space enclosed by the unit’s boundaries, all of the land, structures and fixtures within this space, as set out in the declaration and description.
British Columbia refers to a unit as a “strata lot.” In Quebec, a unit is referred to as a “private portion.”
(e) By-laws
All jurisdictions provide for by-laws of the condominium, which must be consistent with the legislation and with the condominium’s declaration or plan. The by-laws govern such matters as the control, management, administration, use and enjoyment of the units and of the common elements and the regulation and governance of the condominium and the board of directors.
Each jurisdiction’s condominium legislation sets out those matters that can be dealt with in the by-laws. For example, in Ontario, a by-law may be held invalid if it does not fall within the limits of the subject matter set out in Sec. 86 of its legislation, for example, where it deals with an issue which under the legislation must be passed by way of a rule instead. In New Brunswick, rules can only apply to common elements and cannot deal with anything within the unit or ownership of the unit.
Ordinarily, the declarant will prepare the corporation’s initial set of by-laws, including the corporation’s general (omnibus) by-law. Some provinces, such as Saskatchewan and Alberta, have default provincial by-laws in the regulations that are in place when the corporation is created. The developer would typically file by-laws for the corporation, but if they fail to do so, the corporation is governed by the default by-laws until the owners amend them.
Each jurisdiction sets out a procedure for the proper enactment or modification of a by- law; typically, it must be passed by the condominium’s board of directors, approved (with or without amendment) by the owners (sometimes requiring a favourable vote of more than 50% of all voting unit owners, and not just those present at the meeting)), and then registered on title. Saskatchewan requires a favourable vote of 2/3 of all unit owners, and their by-laws are not registered on title but are filed at the Corporate Registry.
The percentage of owners who must vote in favour varies, although most Canadian jurisdictions require the approval of owners holding at least two-thirds of the voting rights. In some jurisdictions, this is set as a percentage of those attending and voting at a meeting; in others, it must be a percentage of all the voting interests in the condominium. The requirements for each province are as follows:
British Columbia: Requires 75% of those voting at a meeting.
Alberta: Requires that not less than 75% of all owners entitled to vote participate and represent not less that 75% of the total unit factors for all the units.
Saskatchewan: Requires approval from at least two-thirds of owners holding voting rights, whether they are present at the meeting or in writing, or a combination of both.
Manitoba: Requires approval by a vote of unit owners where at least 75% of the unit voting rights are present, however the threshold at the meeting (attending in- person and by proxy) is 75% of those present (in-person or by proxy). In other words, the threshold is 75% of 75%.
Ontario: Requires 50% plus 1 of every voting unit in the condominium, for what is sometimes called the bigger or more substantive by-laws, and for certain new types of by-laws created under the proclaimed reforms the percentage is a majority of those owners attending and voting at the meeting (either in person or by proxy).
Quebec: Requires 50% of those voting at a meeting.
New Brunswick: Requires 60% of total voting interests (or higher percentage specified in the declaration).
Nova Scotia: Requires 60% of total voting interests (or higher percentage specified in the declaration) or possibly a higher threshold set out in the condominium’s declaration (see sections 11 and 23 of the legislation).
Special Provisions – Differentiation of Units
Saskatchewan’s legislation contains a provision whereby a corporation may, by by-law, establish “sectors” within the corporation (for example, commercial and residential sectors within a building to differentiate different units or by building where the condominium contains multiple buildings). Through the sector by-law, the corporation may delegate authority to the unit owners of each sector, including the ability to administer the property, establish a separate sector board, and make separate by-laws for the sector. Saskatchewan's legislation is modelled on the British Columbia legislation, except in British Columbia they are referred to as sections.
New Brunswick’s legislation contains a very similar provision whereby if a corporation is for mixed use and a declaration divides the units into classes, then the corporation may make more than one set of by-laws and limit the application of each set of by-laws to one or more of the classes. The corporation may have only one board of directors.
3. Rights and Obligations of the Corporation
(a) Governance of the Corporation – The Board of Directors
All Canadian jurisdictions provide that the condominium corporation, as a separate legal entity, is managed by a board of directors elected by the owners/members (in British Columbia, the board of directors is referred to as the “council”, and the directors as “council members”).
The board is responsible for exercising the powers and performing the corporation's duties, though it can, and typically does, delegate the day-to-day management of the corporation to professional managers (as discussed further in section 3(h), below). Nonetheless, the necessary corollary of the board’s responsibility is its potential legal liability when it fails to carry out its duties or properly.
The composition of the board, the mechanisms for selecting and replacing the members, the qualifications for membership, the term of office, and other similar matters are typically set out in the legislation, though most jurisdictions also allow additional criteria to be imposed through the corporation’s declaration or by-laws (for example, whether a director must be an owner or a resident owner).
Alberta has statutory conditions which would permit the removal of a director or vacancy of an office. In Ontario, directors and candidates for the board must comply with specific mandatory disclosure requirements, and directors who have been elected or appointed for the first time must also complete online director training within six months of their appointment, election, or re-election (if not completed the training within 7 years of their first election or appointment).
In many jurisdictions, the declarant appoints the corporation’s initial board. The condominium legislation in Alberta, Saskatchewan, Manitoba, Ontario, Quebec, and Nova Scotia provides that once sufficient units have been sold, such that the declarant ceases to own a majority of the units, the owners must elect a new board. Nova Scotia requires that this takes place not later than one year after the sale of the first unit. Other jurisdictions simply provide for a new board to be elected at an annual general meeting.
In Newfoundland and Labrador, where the declarant has not sold any units, the board may consist of one person appointed by the declarant. Where there are more than two units, the declarant may appoint directors proportional to the total number of directors that the number of units still owned by it bears to the total number of units in the property. However, the members may pass a resolution that the entire board be elected from the members with an affirmative vote of at least 66% of the members (unit owners) present at the meeting.
In Nova Scotia and New Brunswick, if the declarant owns at least one unit, they can appoint a number of directors proportional to the number of units that they own, rounded down, unless the other owners pass a resolution that the entire board be elected by the owners.1
Ontario’s legislation imposes an unusual additional requirement whereby if at least 15% of the residential or dwelling units are owner-occupied, then one position on the board is reserved for voting (for election or removal) only by owners who live in their unit (i.e. owner-occupied units). Unfortunately, this provision has caused many headaches for corporations concerning proxies and voting procedure. Once the unproclaimed reforms to Ontario’s legislation are proclaimed, then it will no longer be a mandatory position. However, it will be replaced with a “non-leased voting unit” position (only required if greater than 50% of the units are owner-occupied and at least one owner of a non- leased voting unit, i.e. an owner-occupied unit, requests that there be this position).
(b) Standard of Conduct of Directors
Legislation in most provinces sets out a standard applied to a corporation’s directors in exercising the powers and discharging the duties of office. In many cases, this statutory standard approaches or matches the standard imposed on directors of ordinary, non-condominium corporations.
The Yukon, Manitoba and Nunavut provide that a director must act in good faith. Alberta, Saskatchewan, Manitoba, Ontario, New Brunswick, Nova Scotia, and Newfoundland and Labrador add further that directors must exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances.
British Columbia, Alberta, Manitoba, New Brunswick, and Nova Scotia specify that council members must act in the corporation's best interests. Finally, legislation in Quebec applies to condominium directors the same standard as that of the director of any corporation or other legal person; a director must act with prudence and diligence, honesty, and loyalty in the corporation’s best interests.
(c) Rules
Most jurisdictions expressly provide that the board may make rules to govern the corporation’s units, common elements and assets or permit the board to do so if provided for in the by-laws. The corporation’s rules are separate and distinct from the by-laws; generally, they are easier to enact or amend than by-laws. The legislation provides for how rules are validly enacted and amended, and in some cases, what they are allowed to deal with.
It is essential that the rules do not relate to matters that are the proper subject matter of a by-law or that can only be dealt with in the declaration. A purported rule that governs an area outside the scope permitted under the legislation is vulnerable to being struck down if challenged. Most jurisdictions stipulate that the rules must not contradict their legislation or the corporation’s declaration or by-laws.
Most jurisdictions that provide for condominium rules state that the board may make rules (some state that where the condominium’s by-laws provide), respecting the use of the units, common elements and assets to prevent unreasonable interference with the use and enjoyment of the units and the common elements. Manitoba, Ontario, and New Brunswick’s legislation permits such rules regardless of the by-laws.
British Columbia, Alberta, New Brunswick, Nova Scotia, and the Northwest Territories allow the council/board to make rules outlining the use, governance, maintenance, safety and condition of the common property and common assets. Newfoundland and Labrador additionally require that such rules be approved by owners holding at least two-thirds of the voting rights, the same as that required to approve a by-law. Nova Scotia requires that the rules are approved by a simple majority at a general meeting.
In British Columbia, the majority of the owners must confirm the rule at the next annual general meeting for the rule to remain in effect. Saskatchewan does not permit the board to make rules.
In Manitoba and Ontario, the board’s rule-making power is slightly broader. The board may make rules respecting the use of common elements and units to promote the safety, security or welfare of the owners and the property and assets of the corporation or to prevent unreasonable interference with the use and enjoyment of the common elements, the units or assets of the corporation. Further, in Manitoba, the board may make rules to maintain the property’s aesthetic appeal or promote the fair distribution of services and amenities and the use of facilities.
For Manitoba and Ontario, a rule takes effect 30 days after notice is given to the owners, unless a requisition is made for an owners’ meeting within that period. If a valid requisition is received, then a meeting must be called within a stipulated number of days of receipt of the requisition, at which a majority of the owners at the meeting (in person or by proxy) must approve the rule, or do not vote against the rule, for it to take effect.
In Manitoba, after a rule takes effect, the unit owners can vote to amend or repeal it at a general meeting of unit owners. Further, in Manitoba and Ontario the rules must also be reasonable. Manitoba additionally provides that they must be reasonably related to the purpose for which they are intended, they must apply to all unit owners, tenants and other occupants in a fair manner, and they must be clearly expressed to inform a person of what he or she must or must not do to comply.
Legislation in Saskatchewan and Quebec do not provide for rules as distinct from by- laws.
(d) Enforcement
As noted above, condominium law requires the corporation to manage its property and common elements. In doing so, it must ensure that the condominium unit owners and residents, including tenants, comply with the applicable legislation and their declaration, by-laws, and rules.
The enforcement powers granted to corporations vary depending on the jurisdiction and the contravention. Among the measures provided for in legislation (but not the same in all provinces) are imposing fines (not in Ontario), denying the use of common elements, liens for arrears of payment of common expenses or common element fees, garnishing of a tenant’s rent, mediation, and arbitration, and going to court to seek compliance. Common expenses liens and mediation/arbitration are discussed in more detail below in sections 3(g) and 5(a), respectively.
Alberta, Manitoba, and the Northwest Territories permit the corporation to impose monetary or other sanctions on owners, tenants and invitees who fail to comply with the condominium’s by-laws or, for Manitoba, rules. The specific sanctions must be set out in the by-laws and must be reasonable in the circumstances. Where the person fails to comply, the corporation may enforce the sanctions by court order. In the case of Manitoba, these sanctions are subject to the maximum amount and frequencies. Failure of the person to comply allows the corporation to exercise lien rights in the same manner as if the fine were an unpaid assessment of common expenses.
In British Columbia, to enforce a by-law or rule, the corporation may impose a fine, remedy the contravention, or deny access to a recreation facility. However, the corporation may not take these measures unless it has received a complaint, provided the person accused of the breach with details of the complaint and an opportunity to answer, and provided notice of its decision. Recent amendments to British Columbia’s regulations permit a fine of up to $1,000 for each contravention of a by-law that prohibits or limits the use of a residential strata lot for remuneration as vacation, travel, or temporary accommodation.
In New Brunswick, the legislation is silent as to whether or not a corporation can pass a by-law allowing for fines.
(i) Enforcement against owners
Legislation in Manitoba, Ontario, New Brunswick, Nova Scotia, P.E.I., Newfoundland and Labrador, and the three territories state that the corporation has the duty to effect compliance by owners with the legislation, declaration, by-laws and rules. Newfoundland, New Brunswick, and Nova Scotia add a general provision that the corporation has all powers necessary to carry out its duties. All nine jurisdictions specifically permit the corporation to seek a court order directing compliance.
However, as further explained in section 5(a) (below), in Ontario, under Sec. 132 of its legislation, where there is a disagreement with respect to the declaration, by-laws or rules, the corporation must in certain cases proceed by way of mediation and arbitration rather than the courts. In Nova Scotia, either party to the dispute may request mandatory arbitration instead of going to court, while in Manitoba, as well as under the new Newfoundland legislation, arbitration or mediation requires both parties to agree. In Ontario, a court may also order the sale of an owner’s unit, though such orders are relatively rare and issued only where lesser sanctions are insufficient.
Quebec law states that the condominium’s declaration, which includes the by-laws, binds owners and their successors. The only express enforcement measure permits the syndicate to apply to a court for an injunction enforcing compliance where an owner has refused to comply with the declaration, causing serious and irreparable prejudice to the syndicate or another owner. In addition, if the co-owner breaches the injunction, the court may, in addition to any other penalties, order the sale of the owner’s unit. However, the declaration may allow the syndicate to impose penalties for non- compliance in addition to those stated above.
Saskatchewan legislation specifies that the corporation is responsible for effecting compliance by owners with the by-laws. The corporation may take proceedings against a non-compliant owner in Small Claims Court with a maximum penalty of $500 for a given contravention. Alternatively, where both parties agree, they may submit their dispute to arbitration. In addition, owners can take the corporation to court for failing to fulfill its duties and take anyone to court if they face oppressive behaviour or prejudice.
In Ontario, the Condominium Authority Tribunal has exclusive jurisdiction to deal with certain claims, including those related to request for the corporation’s records, and rules dealing with pet, parking and nuisance. Care must be taken to ensure that in a compliance or enforcement claim, the correct legal venue is pursued.
(ii) Enforcement against tenants
In Manitoba, Ontario, and Newfoundland and Labrador, corporations are expressly required either to effect compliance by tenants or occupiers or take all reasonable steps to do so. In Manitoba, corporations must take all reasonable steps to ensure that their commercial lessees, employees, and agents comply with legislation and the declaration and by-laws and have the right to require unit owners and other occupants to comply.
Ontario also permits a court to terminate a residential tenancy in a corporation, and evict a tenant, where the tenant fails to comply with a previous court order for compliance or where the tenant fails to cover any arrears (up to the amount of the rent) of the owner’s monthly common element fees (a form of “garnishment of rent”), when given notice to do so by the corporation.
In British Columbia, the corporation may take the same measures against a tenant as against the owner, though the corporation must give notice. If the person is a tenant, the corporation must also give notice of the complaint and the decision to the unit owner. Where the contravention is repeated and seriously interferes with other residents, the corporation may also evict the tenant.
In Saskatchewan, a tenant must comply with the by-laws as a condition of tenancy, notwithstanding anything in the lease, and the corporation may bring a claim in Small Claims Court against a non-compliant tenant concerning owners. Further, if the by-law provided, the Corporation can apply to Office of the Residential Tenancies for an order to have the tenant evicted from the unit.
In Manitoba, where a residential tenant fails to remedy the breach after having been given notice to do so, the corporation may terminate the residential tenancy.
Quebec provides that the condominium’s by-laws bind a tenant or occupant of a unit upon the tenant or occupant receiving a copy of them. Where a tenant’s non- compliance causes serious prejudice to another owner or occupant, the syndicate may terminate the unit's lease after giving notice to the tenant and the owner.
In Nova Scotia, where a tenant is in violation, the corporation may give notice to the owner. If the owner fails to rectify the situation, the corporation may proceed directly against the tenant under the Residential Tenancies Act.
In some circumstances, condominium legislation may effectively take priority in some areas over residential landlord/tenant legislation. For example, under Ontario’s landlord- tenant legislation, a “no pets” provision in a residential lease is deemed void. However, a pet prohibition in the declaration, or in a valid rule, could be enforced against the tenant, overriding the provincial landlord-tenant legislation.
(e) Repair and Maintenance
Most jurisdictions have broadly similar provisions concerning obligations of repair and maintenance.
(i) Repair of the common elements
All jurisdictions provide that the corporation shall repair and maintain the common elements. British Columbia, Saskatchewan, Manitoba, Ontario, New Brunswick, Nova Scotia, P.E.I., and the three territories expressly permit the declaration or by-laws (in Ontario, only via the declaration) to shift the repair or maintenance responsibility for some or all the common elements to the unit owners and some of the units to the corporation.
(ii) Repair of the units after damage
Manitoba, Ontario, New Brunswick, Nova Scotia, P.E.I., and the territories require the corporation to repair units after damage or failure (from an insured peril event), except where the declaration, or in some jurisdictions, a by-law, provides otherwise. Once the upcoming amendments to the Ontario legislation come into force, this will change in Ontario, with owners having the obligation to repair their units after damage (stemming from an insured peril event) unless the declaration says otherwise.
The legislation in Newfoundland and Labrador provides that the corporation shall make such repairs in all cases. In Saskatchewan, only the responsibility to maintain exclusive common property can be shifted to the owner who has exclusive use of that area of common property; however, the by-laws can make the corporation responsible to maintain all or a portion of a unit. The by-laws may also allow for the cost of that maintenance to be included in the reserve fund study and allow the corporation to collect the fees for this maintenance.
Notably, however, the corporation’s duty to repair units after damage in these jurisdictions excludes improvements to the unit made by owners. The obligation is to insure and repair after damage to the level of the standard unit or the unit as it was at the filing of the declaration (typically the definition of the standard unit is set out in a by- law, or, in Ontario, the form provided by the Declarant after turnover of the corporation, which can be amended by a subsequent standard unit by-law).
British Columbia permits the corporation, by means of by-law, to assume responsibility for repairs to a strata lot. Quebec precludes an owner from interfering with the syndicate making urgent repairs or work necessary to conserve the building, even where such work is inside the owner’s private portion. In Manitoba, a declaration may vary a corporation’s duty to repair after damage to require the corporation to repair after damage improvements to a unit.
(iii) Maintenance of units
British Columbia, Alberta, Manitoba, Ontario, New Brunswick, Nova Scotia, Newfoundland and Labrador, P.E.I., and the territories expressly state that the owners must maintain their units. Most of these same jurisdictions also state that where an owner fails to reasonably carry out the obligation to repair (not “repair after damage”, which is different) or maintain, the corporation may do the work at the owner’s expense, the costs of which can be charged back to the unit’s common expenses and be recoverable by way of a lien. Saskatchewan provides that a corporation may bring an action in debt to recover any sums expended for repairs to an owner’s unit.
In addition, all jurisdictions except P.E.I., Nunavut and the Yukon, allow for the designation of use of specified common elements to a specified owner or owners (sometimes referred to as “exclusive use” or “restricted use” common elements or areas, or “limited common property”). As an example, Manitoba and Ontario’s legislation permits the corporation, in its declaration, to impose repair and maintenance obligations on an owner in respect of their exclusive use common elements. British Columbia permits the corporation to impose these same obligations on an owner by means of a by-law. Alberta, similarly, permits the corporation to delegate its responsibility for exclusive use common elements.
(f) Reserve Fund
Most jurisdictions require the corporation to maintain a reserve or contingency fund, generally for major repairs and replacement of the common elements and assets of the corporation. The fund cannot be used for general operating expenses. The corporation collects contributions to the reserve fund from the owners as part of their common expenses. This fund is strictly controlled and often thought of as “sacred trust”.
Alberta, Saskatchewan, Ontario, New Brunswick, Nova Scotia, Newfoundland and Labrador and the Northwest Territories provide for certain reporting or oversight requirements in respect of the fund, sometimes called “reserve fund studies,” to ensure it is adequately funded. In the amended legislation of British Columbia, a ‘Depreciation Report,’ serving a similar function to a reserve fund study, must be compiled every three years and is to include an estimate of all major repair and replacement costs in addition to expected lifetime of items of the strata corporation. In Newfoundland and Labrador, reserve fund studies are only required for properties consisting of 10 or more units. Where a reserve fund study is required and the property is a newly registered condominium, the study must be completed before the sale of the first unit.
Legislation in Alberta, Saskatchewan, Manitoba, Ontario, New Brunswick, Nova Scotia, Newfoundland and Labrador, and the Northwest Territories mandate the frequency of conducting reserve fund studies. Alberta, Ontario, New Brunswick, Nova Scotia, and the Northwest Territories, require the corporation to ensure the fund is adequately funded. In New Brunswick, the amount in the reserve fund must match the minimum funding recommendations of the reserve fund study and, if not, then the corporation must assess and collect the amount from the owners. Saskatchewan and Manitoba do not require the fund to be adequately funded. While the board has to take the reserve fund study into account, they can opt to not abide by its recommendations.
In addition, in Manitoba and Ontario, the board must notify all owners of its funding plan (sometimes called the Notice of Future funding). In New Brunswick, the corporation must submit its reserve fund study to the government within 30 days of its completion or any update.
Only P.E.I., Yukon, and Nunavut seem not to have any provision in their legislation for a reserve fund.
(g) Common Expenses Lien
Unit owners’ contributions to the corporation’s common expenses (often called “common element fees” or “condominium fees” and often thought of by owners as “maintenance fees”) are usually practically the sole source of revenue for the corporation. Some owners may not be aware that a ruling by the Canada Revenue Agency (“CRA”) found that condominium corporations are not-for-profit entities that rely on the regular payment of common elements fees to function. Therefore, timely and full collection of these fees is crucial. A corporation’s not-for-profit status could be revoked by the CRA on a case-by-case basis depending on the revenue and profit status of the corporation (e.g. if significant revenue is generated from such sources a guest suite, and mobile antenna, rentals, etc.).
Given the importance of collecting the monthly fees, corporations in all jurisdictions have the statutory right to register a lien or similar charge against an owner’s unit where the owner defaults on the obligation to pay the monthly fees (or, in some jurisdictions, other common expenses as well). The unpaid amount constitutes a lien on the real property interest of the owner and may be registered by the corporation as an encumbrance over the unit.
Most jurisdictions provide the corporation with the supplemental right to claim for certain costs associated with the collection of arrears. One exception is P.E.I. which does not explicitly provide the right to claim for costs associated with the collection of arrears.
Provided that statutory notice requirements are complied with, registered liens for common expenses will rank in priority over most other registered or unregistered interests, including mortgages. Relatively few other liens, such as liens in favour of the Crown or certain municipal liens, will take precedence over common expenses liens.
Some provinces impose strict procedural steps to protect or perfect the lien or charge rights. For example, in Ontario and New Brunswick, a corporation must send out a Notice of Intent to Lien to the owner at least 10 days before the lien can be registered. In British Columbia, such notice must be given to the owner at least 14 days prior to the registration of the lien. In Manitoba, the corporation must give the unit owner written notice of the lien at least 7 days before a lien is registered. In Quebec, one of the legal types of hypothecs is akin to a lien against an owner’s unit for unpaid common expenses; this takes effect only upon registration of a notice indicating the nature of the claim, its current amount, and the expected changes for the current and succeeding two financial years.
Manitoba, Ontario, New Brunswick, and P.E.I. provide that the lien right expires three months after the default that gave rise to the lien, unless a certificate of lien is registered against title to the unit within that time frame. While the corporation may still go after the owner for the arrears, it will have lost the right to register a lien on title for those arrears that are more than three months old. In this case, those amounts will also lose priority along with the entitlement to additional amounts (for example, reasonable expenses of collection including legal fees) that are otherwise included in the lien.
All jurisdictions except British Columbia expressly provide that the corporation has the right to enforce the lien or charge in the same manner as a mortgage (i.e. power of sale right). British Columbia, while not specifying that the lien may be enforced in the same manner as a mortgage, operates quite similarly: it permits the corporation to apply to the court for a sale of the strata lot, and the court may, in its discretion, order such a sale on price and terms to be approved by the court or may enter judgment against the owner for the amount of the lien.
In Alberta, Saskatchewan, Manitoba, New Brunswick, Ontario, the Yukon, and Northwest Territories, the corporation that registers such interest or lien shall discharge it on payment of the amount of the lien, while in British Columbia, the lien must be removed within one week of receiving the amount owed.
(h) Management
The corporation (through its board of directors) is responsible for the operation and management of the corporation, including the enforcement of the legislation and its declaration, by-laws, and rules. However, the board is permitted to delegate some of these responsibilities to managers, whether in-house (i.e. employees of the corporation), or by contracting with third party management companies. Most jurisdictions refer to this as a “management agreement,” while British Columbia refers to it as a “strata management contract”.
In Alberta, Saskatchewan, and the Northwest Territories, a management agreement entered into by a board elected while the majority of the units were owned by a developer (otherwise known as a developer’s or a declarant’s management agreement) may not be terminated without cause until the term of the agreement has reached one year, unless otherwise permitted by the agreement. In contrast, Manitoba provides that despite any term to the contrary, the management agreement may be terminated on 30 days’ prior written notice at any point during the 12 months after the turnover meeting if the contract was entered into prior to the date of the meeting. In Ontario it can be terminated by the corporation upon giving 60 days notice
In Alberta, Saskatchewan, Newfoundland, P.E.I., and the Northwest Territories, termination of such a contract by either party requires 60 days’ written notice.
Furthermore, most legislation permits the developer’s management agreement to be terminated at any time after the developer ceases to own more than 50% of the common elements. Nova Scotia provides for a maximum term of two years for a management agreement, and that such agreements made by the developer (before the election of the first owners’ board) can be summarily cancelled.
British Columbia legislation requires licensing of professional strata managers. Effective November 1, 2017, Ontario enacted the Condominium Management Services Act under which condominium property managers, or anyone receiving income while conducting statutorily defined management services, must be licensed. The licensing provisions provide enhanced competency, transparency, education, and accountability for managers.
To look after the licensing, education, and discipline of licensed managers, Ontario created an Administrative Authority called the “Condominium Management Regulatory Authority of Ontario”. Similarly, Manitoba enacted the Real Estate Services Act, which purports to require licensing of condominium managers. There is some ongoing discussion about whether this legislation captures condominium property managers, but as of the date of his Primer, the requirement has not been challenged.
(i) Auditing
Most jurisdictions impose strict financial record-keeping and audit obligations on the corporation. However, not all jurisdictions dictate that the financial statements of the corporation must be audited.
In Manitoba, Ontario, and Nova Scotia, there are extensive provisions dealing with this. At each annual meeting, the owners must appoint an auditor of the corporation to hold office until the close of the next meeting. Where an auditor is not appointed at an annual meeting, the auditor in office continues their term until a successor is appointed. The auditor must be sufficiently independent of the corporation and, in Ontario, must be licensed as a public accountant under the Public Accountancy Act.
The auditor prepares and submits audited financial statements to the owners at each annual general meeting. The audited financial statements must be prepared in the form prescribed by the regulations, made in accordance with generally accepted accounting principles, and they must be approved by the board prior to being presented at each annual general meeting. It should be noted that auditors report to the owners and not to the corporation or its board.
In Ontario, a corporation that consists of fewer than 25 units and has held its “turnover” meeting (where control of the corporation is turned over from the developer to the unit owners), may, at an annual general meeting, waive its requirement for an auditor for that year provided that 100% of the unit owners as of the date of the meeting have consented in writing to do so.
In Nova Scotia, corporations with less than 10 units do not need an audit. Manitoba and Newfoundland and Labrador have substantially the same provisions, however, the right to waive the requirement to appoint an auditor is only available to corporations that consist of fewer than 10 units. In New Brunswick, the threshold is fewer than 11 units.
Furthermore, New Brunswick does not make formal reference to an “auditor,” but instead requires a Review Engagement prepared by, amongst others, a CPA.
Nova Scotia contains similar provisions to the other jurisdictions, especially Ontario, as it specifically requires the appointed person to hold a Public Accountant Auditing License under the Public Accountants Act. The appointed person is to have access to all records, documents, accounts, and vouchers of the corporation and make reports on the comparative financial statement of retained earnings, income statements and statements of changes in the financial position to be laid before the corporation at each annual meeting. Condominiums with less than ten units are not required to engage an auditor and may present management accounts signed by two Board members.
In Alberta, the audit requirements are not as extensive as they are in Ontario, Newfoundland and Labrador, and Nova Scotia and do not require any formal “audit” unless the by-laws require it. Regardless, the board of directors remains subject to certain general audit requirements. The board of directors is responsible for the preparation of financial statements (in accordance with GAAP) relating to all money of the corporation, the income and expenditures of the corporation, and other material financial documents that the board sees as necessary or as may be directed by a resolution at an annual general meeting.
In Saskatchewan, the newly amended statue has introduced strict auditing requirements. If a corporation consists of more than 50 units, an audit must be completed. If, however, the corporation consists of between 12 and 50 units, and if 80% of all owners vote in agreement, then the audit can be waived with only a financial review being required. If 100% of the owners vote in agreement, then both the audit and the financial review can be waived. This vote must be conducted on an annual basis. Corporations with fewer than 12 units are automatically exempted from the audit requirement and may dispense with a review with the consent of 80% of owners. Like Ontario, Saskatchewan requires auditors to be independent and qualified under the Accounting Profession Act.
In P.E.I., while the board’s audit obligations are not explicitly mentioned, the provincial legislation refers to an “inspector” who may be appointed to investigate the affairs of any person in receipt of money paid by or on behalf of an owner for the payment of common expenses and to make an audit of the accounts and records. The inspector, once appointed, has all the power of a commissioner under the Public Inquiries Act.
In Quebec, the syndicate must enclose the documents required to call an annual meeting, a balance sheet, the income statement for the preceding financial period, and statements of debts and claims. Generally, the financial statements need not be audited, though such an audit must take place if demanded by co-owners representing 40% of the voting rights.
(j) Insurance2
A comparison of the insurance provisions in Canadian condominium legislation presents particular difficulties.
While the insurance industry across the country operates under one arrangement set out in the Agreement of Guiding Principles of the Insurance Bureau of Canada, and while there is consensus across the country on how the insurance scheme is to operate, there is a surprising diversity in the language used among the thirteen legislative provisions and the Agreement of Guiding Principles. In some instances, the variation in the language used is very subtle, with the result that great care should be used in determining the precise legal implications of the legislation in each jurisdiction.3
The basic insurance scheme provided for by the insurance industry’s Agreement of Guiding Principles calls for the condominium corporation to carry damage insurance coverage on both the common elements and the units. However, it is important to note that the insurance scheme does not include coverage for improvements added to the units by unit owners.
This scheme is applied in the legislation of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, P.E.I., Newfoundland and Labrador. Where the Agreement of Guiding Principles and these statutes diverge most markedly is in defining the exempted improvements. The British Columbia statute, for instance, refers to the corporation’s obligation to ensure “fixtures” installed by the developer as part of the original construction. In Manitoba, Saskatchewan and Nova Scotia, the description of a standard unit including all fixtures and fittings must be included in the declaration. Nova Scotia corporations that predate this requirement may add a standard unit definition to their declaration.
Saskatchewan’s newly amended legislation will require a standard unit by-law for new developments and legacy status for existing corporations when they amend their by- laws. Alberta’s legislation now requires the adoption of a standard insurable unit description detailing the fixtures and improvements in units that the corporation is responsible for insuring and repairing in the event of an insured loss incident. Other statutes refer either to improvements added by a unit owner or to improvements added after registration of the condominium corporation.
The Ontario legislation tries to avoid this difficulty of defining improvements by requiring the passage and registration of a standard unit by-law to establish the level of unit finishing covered by the corporation’s policy (and does not necessarily mean the unit as originally constructed). Once further amendments to the provincial legislation come into force in Ontario, the regulations will provide a standard unit definition (which can still be overridden by passing a by-law).
A second approach is used in the legislation of Nova Scotia, New Brunswick, and all three Territories. Each provides that the corporation is to insure its liability for repairing the common elements and the units. This obligation to insure, which may not be as comprehensive, may be further varied by the provisions of declarations or by-laws. For example, in New Brunswick, the minimum coverage is for fire damage; however, additional risks may be specified in the corporation’s declaration or by-laws. Additionally, in New Brunswick, the corporation must submit proof of its insurance to the government each year.
A number of jurisdictions provide that an owner may, in effect, duplicate the corporation’s coverage on the owner’s unit to satisfy the requirements of a mortgagee. Most of those statutes also provide that this insurance is not to be brought into contribution with any other insurance. It is difficult to see why these provisions are necessary as the corporation’s insurance should adequately protect all mortgagees.
Some jurisdictions, such as British Columbia, Manitoba, Ontario, and Nova Scotia have further provisions regarding responsibility for the deductible amounts on the corporation’s insurance policy.
Most jurisdictions provide that the damage insurance is to be for full replacement cost, and some specify the range of risks to be covered or provide that the risks to be covered may be specified in declarations or by-laws.
The legislation in each of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, and all three territories contains specific provisions with respect to bare land or vacant lot units. In Ontario, the corporation does not carry insurance on vacant land units; in British Columbia, the corporation insures bare land units, but not improvements made by an owner. In the other six jurisdictions, the corporation may be required to insure bare land units by the provisions of specific declarations. In Saskatchewan, for example, the corporation is required to insure both the standard unit and the common elements if they are connected to bare land. If they are not connected, then they do not need to insure the standard unit.
Most provinces either require the carrying of Directors and Officers negligence insurance or require it if reasonably available. Although not mandatory, many provinces encourage corporations to carry directors’ and officers’ fidelity insurance for their dishonest acts. Under Alberta’s legislation, such fidelity bonds are now mandatory.
(k) Status Certificate
Most jurisdictions require the corporation to provide information statements about various matters relating to the specific unit and the corporation as a whole, including potential or actual liabilities of the unit and the corporation. This statement is referred to variably as a “status certificate”, “information certificate”, or “estoppel certificate”, depending on the jurisdiction. What is most important is that the certificate binds the corporation as of the date it was given or deemed to have been given with respect to the information that it contains or is deemed to contain as against a purchaser or mortgagee of a unit who relies on it.
In Ontario and Saskatchewan, the form of the status certificate is prescribed by the regulations. It must contain such information as, for example: (i) whether the unit in question is in arrears; (ii) any knowledge of a coming increase, or reason for a future increase, in the common element fees or a special assessment; (iii) disclosure concerning the reserve fund; (iv) whether any lawsuits are outstanding against the corporation, and in Ontario as of mid 2018 - electric vehicle charging; as well as many other matters.
An Ontario corporation must provide the status certificate within 10 days after receiving a request for it and payment of the prescribed fee (presently $100). A corporation that does not give a status certificate within the required time shall be deemed to have given a clear certificate on the day immediately after the 10-day period expired, for certain aspects of the status of the corporation. If the certificate omits material information that it is required to contain, then it is deemed to include a statement that there is no such information.
In Nova Scotia, the information to be included in the estoppel certificate and the documents that must be provided with it is set out in its legislation. The corporation must provide the certificate "on the application of an owner or purchaser” with no specific time to provide the certificate. The legislation is silent on the right to charge a fee.
Legislation in the Northwest Territories provides for similar information requirements, as well as a 10-day period for making the required information available. Alberta legislation includes two documents – one is an estoppel certificate dealing with condominium fee payments, arrears and interest, and the other is an “information on request” which covers other relevant information for which the corporation may charge a fee. Neither legislation explicitly provides for any deemed statements if the corporation does not provide the information within the required 10-day period.
In British Columbia, the information that must be contained in an information certificate is substantially similar to that in Ontario and Alberta. The corporation must provide the information certificate to the requesting individual within 7 days. Similar to Alberta, British Columbia does not provide for any deemed statements if the corporation does not provide the information certificate within the required 7-day period.
Manitoba’s legislation provides for two different documents that should be provided to a buyer. At the time the agreement of sale is entered into, the owner of the unit must provide the buyer with a Disclosure Statement provided by the corporation (in addition to the seller’s own Disclosure Statement). The corporation’s Disclosure Statement is prescribed from and contains information relating to a wide variety of topics, including insurance, reserve funds, restrictions on the use of units and the fundamentals of the corporation’s governance.
The Status Certificate is usually requested immediately prior to the closing of the sale and is also a prescribed form. The document must disclose (i) any amount owing by the unit owner and (ii) if, to the corporation’s knowledge, there has been any breach to the declaration, by-law or rules outlined which the subsequent owner may be required to remedy. Additional information as to the unit’s entitlement to parking and storage locker spaces is also provided.
Legislation in Saskatchewan, New Brunswick, and Newfoundland and Labrador require corporations to provide an estoppel certificate to an owner or purchaser. The contents of the certificate are prescribed and similar to the Ontario legislation. In New Brunswick, as in Ontario, where the corporation fails to provide the certificate within 10 days, the legislation deems certain statements to be made in favour of the person obtaining and relying on it.
In Quebec, a prospective purchaser of a unit may request a statement of the common expenses due in respect of that unit; the syndicate may provide such a statement provided it gives prior notice to the current unit owner. The purchaser is only required to pay the expenses owing in respect of the unit if the statement is provided within 15 days of the request.
(l) Communication to Owners – Information Certificates
With the enactment of its reforms that came into force on November 1, 2017, Ontario required more communication with owners and mortgagees and thus introduced an obligation to circulate three new types of information certificates:
(a) Periodic Information Certificate, to be sent out twice a year;
(b) Information Certificate Update, to be sent out only when certain prescribed events occur, e.g. change in a director(s); and
(c) New Owner Information Certificate, to be sent out to new owner (a type of welcome package).
(m) Condominium Authority of Ontario (CAO) - Annual Filing and Notice of Change
As discussed in section 5(a) below, the Ontario government created the CAO. It provides a multitude of services to the industry including information, the CAT, mandatory training of directors, and a public registry of information related to all corporations. Every corporation must register with the CAO, submit an annual filing and pay an annual fee per voting unit (paid by the corporation as a general expense and thus forms part of the unit’s common expenses). The registry must be current; therefore, there is a statutory obligation on corporations to file a Notice of Change if certain prescribed events or changes occur in the corporation.
4. Rights and Obligations of the Owners and Mortgagees
(a) Contribution to Common Expenses
An individual unit owner is not generally responsible for day-to-day operation and maintenance of the building that often is associated with home ownership. This is normally the responsibility of the corporation and is paid for through the common expenses which common expenses are collected from each unit owner. Simply put, common expenses are the expenses related to the performance of the objects and duties of a corporation, as well as all expenses specified as common expenses in the condominium’s declaration. This includes just about everything required to operate the building, such as utilities, services contracts, maintenance, and repairs (not of the units), management, reserve fund, and so on.
As owners in and of the corporation, each must contribute to the condominium’s common expenses in the proportion set out in the declaration. In British Columbia, effective March 7, 2018, variable user fees are permitted based on a consumption- based rate which must be reasonable and permitted by either a by-law or rule. As stated above, in most jurisdictions, failure of the unit owner to pay common expenses fees when they are due provides the corporation with a lien on the interest of the owner. (See section 3(g), above.)
In Alberta, these fees are referred to as “contributions”.
(b) Annual General Meeting
All jurisdictions require the corporation to hold an annual general meeting. At the meeting, the corporation may address matters such as the election of the board, reserve fund financing, insurance, the appointment of the auditor (or waiving of an audit), budgetary discussions, election of directors, election, or appointment, of a chair (if required), review of officers’ reports, and the review committee reports. All owners receive notice of the annual general meeting, and are entitled to attend, speak, and, if qualified, vote, either in person or by proxy.
All jurisdictions, save for Yukon, New Brunswick, and Nova Scotia outline additional specific requirements that the annual general meetings must follow.
In Alberta and Saskatchewan, an annual general meeting must convene every calendar year and within 15 months of the conclusion of the immediately preceding annual general meeting. In Saskatchewan, an owner may call an annual meeting if the board has failed to convene an annual meeting within 15 months.
In Manitoba and British Columbia, the annual general meeting must be held in temporal proximity to the corporation’s fiscal year end; more specifically, it must be held within 6 months in Manitoba, and 2 months British Columbia. In both provinces, the corporation does not have to hold an annual general meeting if all eligible voters waive, in writing, the holding of the meeting. In British Columbia, voters must also approve the budget for the coming fiscal year and elect a council by acclamation.
In the Northwest Territories, the legislation provides that the board shall convene an annual general meeting of the owners within 6 months of the corporation’s fiscal year end.
In P.E.I., the annual general meeting must be held no more than 3 months after the registration of the declaration and description and subsequently within 15 months after the holding of the last preceding annual meeting.
In Ontario, the board must hold a general meeting of owners no more than three months after the registration of the declaration and description, and subsequently within 6 months of the end of each fiscal year. The board must send a preliminary notice to owners prior to sending a notice of meeting using mandatory forms within the prescribed timelines. The preliminary notice to owners provides information on the upcoming meeting, including inviting potential candidates to notify the condominium of their interest in running for the board along with the new mandatory disclosure statement, and it provides a deadline for owners to request that additional material be included in the notice of meeting. The annual general meeting must deal with the submission of the audited financial statements (and report of the auditor) and the election of directors. There is also a mandatory proxy form which must be used for meetings of the owners.
In Ontario, as of October 1, 2023, Bill 91 became law and has enhanced the ability of corporations to navigate digital spaces when conducting meetings. The amendments primarily facilitate virtual transmission of notices and condominium documents, permit corporations to conduct meetings and voting in virtual or hybrid formats, and replace temporary provisions that expired on September 30, 2023, that were created due to the need to adapt to the Covid-19 pandemic. Owner’s meetings can proceed virtually or through hybrid formats if all persons entitled to attend can “reasonably participate.”
Also, in Ontario, board meetings can proceed through these methods as long as directors can “communicate with each other simultaneously and instantaneously.” The previous requirement for “unanimous consent” of all board members required to hold a virtual or hybrid meeting is subsequently no longer in effect. Both owner’s meeting and board meeting are subject to their own internal by-laws restricting virtual or hybrid methods. The Act also introduces electronic voting options and allows condominium corporations to send electronic notifications to owners, provided there's no contrary by- law or owner objection.
In Manitoba, Ontario, and P.E.I., the legislation states that an owner may raise for discussion any matter relevant to the affairs and business of the corporation, but if the matter is more than a procedural issue, no vote can be taken on it as it must be disclosed in the notice calling the meeting.
In Quebec, as is the case for all corporations, the annual meeting of co-owners has to be called within six months after the close of the fiscal year.
In Newfoundland and Labrador, the corporation’s first annual meeting must be held not more than 18 months after it was created. Thereafter, subsequent annual general meetings must be held within 15 months of the last meeting. Legislation provides those annual general meetings, and in fact all meetings of members, may be held by telephone or other electronic means or methods so long as certain conditions are met. Voting at such meetings may also be held by telephone or other electronic means or methods. The legislation also provides that at each annual meeting (for corporations having 10 or more units), the owners must set the corporation’s fiscal year and appoint an auditor.
(c) Leasing of Units
In all jurisdictions, owners are entitled to lease or rent their units, subject to restrictions set out in the legislation and the corporation’s declaration, by-laws or rules. However, if an owner chooses to lease or rent their unit(s), the owner is the legal landlord, and accordingly remains responsible for the actions of their tenants.
(i) Information to be provided to the corporation
In some jurisdictions, such as Manitoba and Ontario, the legislation requires the owner to provide leasing information to the corporation. In both provinces, the owner of a unit who leases the unit or renews a lease of the unit must, within 30 days of entering into the lease or the renewal, notify the corporation that the unit is leased and provide certain information (set out in regulations) regarding the lease and the lessee, to the corporation.
In Saskatchewan, the owner must give notice to the corporation within 20 days from the commencement of the tenancy as well as 20 days after the tenant ceases to rent, along with the new tenant’s information (set out in regulation) and the landlord’s contact information. The corporation can also require a damage deposit from the unit owner.
In Nova Scotia, a renting owner must give the corporation the name and address of all tenants.
In Alberta and the Northwest Territories, the owner must give the corporation written notice of the name of the tenant renting the unit within 20 days from the commencement of the tenancy, as well as 20 days after the tenant ceases to rent the owner’s unit. If the individual renting or leasing a unit damages any property or contravenes a by-law, the corporation can terminate the lease and require the tenant to give up possession, provided a minimum of one month’s notice is given.
(ii) Responsibility for tenant actions
In Manitoba, the unit owner has the duty to take all reasonable steps to ensure a residential tenant or commercial lessee’s compliance with the legislation declaration, by- laws and rules of the corporation. If the tenant fails to comply, the corporation is entitled to terminate the tenancy and evict the tenant but is required to provide the tenant and the owner with reasonable notice of the breach and must allow the owner reasonable time after receiving the notice to remedy the contravention or breach prior to effecting any termination.
Interestingly, Manitoba also allows corporations to impose a levy on any unit owner who rents their unit as long as this right is contained in the corporation’s declaration. The levy amount must not exceed the prescribed maximum and must be specified in the by- laws. This amount can only be used by the corporation to pay for repairs to, and extraordinary cleaning of, the common elements that arose from the rental, or reasonable costs associated with ensuring compliance by the residential tenant or commercial lessee with the legislation, declaration, by-laws, and rules. Any balance remaining must be returned to the unit owner at the termination of the tenancy or lease.
In Ontario, the owner is also required to take all reasonable steps to ensure the tenant’s compliance with the legislation and its declaration, by-laws and rules. Unlike Manitoba, however, court intervention is required to terminate a tenancy. The owner or the corporation, among others, may seek a court order compelling the tenant’s compliance; and only where the tenant contravenes such an order can they seek a further order evicting the tenant. Moreover, in certain cases, the dispute must first proceed by way of mediation or arbitration, discussed below at section 5(a).
As mentioned above, British Columbia’s legislation requires a disclosure statement to be provided when an owner developer rents or intends to rent one or more residential strata lots. The developer must give a copy of the statement to the superintendent of the strata lot and to every prospective purchaser. As mentioned earlier, recent amendments to British Columbia’s regulations allow corporations to impose a maximum fine of
$1,000 for each contravention of a by-law that prohibits or limits the use of all or part of a residential strata lot for remuneration as vacation, travel, or temporary accommodation.
In Quebec, an owner who leases his unit must notify the syndicate and provide the name of the lessee. The tenant is liable for complying with the by-laws once the owner or the syndicate has provided him with a copy of them.
In New Brunswick, The Residential Tenancy Act applies to all tenancy agreements. This agreement shall be in a Standard Form Lease prescribed in the regulations under the Act and the lease shall include a schedule containing the by-laws and rules of the corporation.
In Nova Scotia, the corporation may give notice to the owner of any default by the tenant, and, if the owner fails to rectify the situation, the corporation may proceed directly against the tenant under the Residential Tenancies Act.
(d) Mortgagee’s Rights
Two particularly important rights of mortgagees are the right to vote in place of the owner and the right to collect the owner’s contribution towards common expenses.
(i) Right to Vote
Under certain conditions, the mortgagee may vote in place of the owner. In Ontario, a mortgagee of a unit has the right to vote at the meeting in the place of the unit owner, provided the mortgage terms provide for it, the mortgagee has notified the corporation of its right, and the mortgagee has given notice to the corporation and the owner at least 4 days before the date of the meeting of their intention to vote in place of the owner.
Legislation in Saskatchewan, Manitoba, P.E.I., and the three territories provides the mortgagee with a right to vote similar to that in the Ontario legislation. However, in P.E.I. the mortgagee need only provide 2 days’ notice to the corporation. In Saskatchewan, Manitoba, and the three territories, the legislation does not provide an express time limitation for giving such notice.
In Alberta, where an owner’s interest is subject to a registered mortgage, a power of voting that is conferred on an owner by the legislation or by way of a by-law may be exercised in the following order: first, by the mortgagee, if any, if that mortgagee has notified the corporation of the mortgage in writing; second, by the owner; third, by any other mortgagee so entitled in the order of their pre-established priority, provided that the mortgagee has given written notice to the corporation of their mortgage. However, neither the mortgagee nor the owner can vote if the unit has arrears.
In British Columbia, the mortgagee of a strata lot is entitled to vote, but only in respect of insurance, maintenance, finance or other matters affecting the mortgage’s security, and only if: (i) the mortgage gives the mortgagee the right to vote; and (ii) the mortgagee has given written notice of their intention to vote to the corporation, the owner, and (if applicable) the tenant.
The legislation in Newfoundland and Labrador, New Brunswick and Nova Scotia provide that the mortgagee may only exercise the voting or consent rights of an owner in cases where the mortgagee is a “mortgagee in possession”.
In Quebec, hypothecary creditors of a unit must sign any decision to terminate the co- ownership.
(ii) Right to Collect Common Expenses
In Alberta, Saskatchewan, Manitoba, and Ontario, the mortgagee has the right to collect the owner’s contribution to the common expenses and must promptly pay the collected amounts to the corporation on the owner’s behalf. In Ontario, the mortgagee also has the right to pay the owner’s arrears and associated costs under a lien and to add this amount to the debt secured by the mortgage or to deem the unit owner in default for failure to pay common expenses. Alberta extends the power to offset contributions to the owner’s tenant when served with proper notice by the corporation.
(e) Amending the Declaration or Description
All Canadian jurisdictions permit amendments to the corporation’s declaration or description in certain circumstances by the consent of the owners and/or by court order. Where proceeding by consent, all jurisdictions require the approval of a supermajority of the owners for substantive amendments or changes to the declaration, description, or plan. The specific procedures vary from province to province.
In Ontario, the usual method is by board resolution approving the amendment, which then must be consented to in writing (no vote) by owners holding at least 80% or 90% of the voting rights, depending on the type or nature of the amendment. Alternatively, an owner or the corporation can apply to the court for an order amending the declaration or description; however, this can only be done where the amendment is to correct an error or inconsistency. In addition, one can apply directly to the Director of Titles for an order to correct an error or inconsistency apparent on the document’s face.
Alberta only permits an amendment to a condominium plan by court order, which will be granted where:
(i) the amendment has been approved by at least 75% of the owners representing at least 75% of the voting rights,
(ii) the court is satisfied that no unfair prejudice will result to the owners and the holders of any encumbrances registered against title, and
(iii) the necessary survey documents have been provided. Exceptionally, however, any owner or owners may modify the condominium plan without amendment if the modification consists of re-dividing or consolidating a unit or units.
In British Columbia, most amendments to a strata plan require a unanimous vote at an annual or special general meeting of the owners, followed by an application to the Registrar of Titles. Exceptions to the unanimity rule include division or consolidation of strata lots that do not change the total rights or obligations of the new lot or lots and adding land to the strata plan to create a new lot or expand an existing one.
In Saskatchewan, an amendment to the condominium plan requires the written consent of at least 80% of all unit owners and holders of encumbrances, as well as the approval of the Controller of Surveys and the issuance of new titles through an application to the Registrar of Titles. An owner or holder of an encumbrance that has not consented may apply to the court to object to such amendment, and the court may make any order it considers fair and equitable. However, the Controller of Surveys may order a correction of a clerical error in the plan without the need to seek an amendment to the condominium plan.
In Manitoba and the Northwest Territories, a declaration or plan may be amended with the written consent of owners holding at least 80% of the voting rights, or such higher percentage as is specified in the declaration. In P.E.I. and the Yukon, amending the declaration, description or plan requires the written consent of all owners and holders of encumbrances. Where such consent cannot be obtained, Manitoba and the Yukon permit the amendment of the declaration, description, or plan by court order. In the Northwest Territories, by contrast, an owner or holder of an encumbrance may apply to the court to object to such an amendment. A court hearing such applications must take into consideration, among other factors, any prejudice to the rights or interests of the owners, and what course of action would be most fair and equitable.
In Quebec, modifications to the declaration require the approval of a majority of the owners representing 75% of the voting rights, except where the modifications are to the by-laws, where only a simple majority of votes is required.
In New Brunswick, for a non-phased development, an amendment to a declaration or description requires the consent of owners holding at least 60% of the voting rights (i.e. owners of 60% of the common elements) or great percentage if specified in the declaration. In Nova Scotia, such an amendment requires the consent of 80%. In both provinces, the Director or Registrar of Condominiums may amend the declaration or description without the owners’ consent to correct a clerical or mathematical error. Additionally, in both provinces, amendments can also be made without the consent of the owners if the amendment in question creates a subsequent phase of a phased development condominium property.
Under Newfoundland and Labrador’s legislation, an amendment requires consent of the owners holding at least 80% of the voting rights; however, there is no alternative to amend through a court order if such consent cannot be obtained. In P.E.I., similar to Ontario, a corporation may obtain a court order amending the declaration or description, but only where needed to correct a manifest error or inconsistency.
5. Dispute Resolution
(a) Mediation and Arbitration
Alternative dispute resolution (“ADR”) refers to resolving disputes in ways other than formal litigation in the courts. Mediation and arbitration are two of the most common forms of ADR. Many jurisdictions across Canada provide for ADR in their condominium legislation.
In Ontario, every agreement between a declarant and a corporation, two or more corporations, a corporation and an owner (if the agreement relates to changes the owner has made to the common elements), or a corporation and a person for the management of the property, is deemed to contain a provision stating that any disagreement between the parties concerning the agreement shall be submitted to a person selected by the parties for mediation. If the matter goes to mediation but is not resolved or settled (or the parties cannot agree on a mediator), then the dispute must go to arbitration under the Arbitration Act, 1991.
With respect to disagreements between the corporation and the owner, Ontario’s legislation deems every declaration to contain a provision that the corporation and the owners agree to submit to mediation and arbitration a disagreement between them with respect to the declaration, by-laws, or rules. In addition, the legislation sets out certain terms concerning mediation, including how the mediator’s costs are to be shared. The wording of this subsection has been applied inconsistently, as it is not always clear when a disagreement concerns compliance with the legislation for which the corporation can proceed directly to court, as opposed to a disagreement that must proceed by way of mediation and arbitration. As a result, many corporations enact a mediation and arbitration by-law to govern the procedure for mediation and arbitration.
In Ontario the purpose of the Condominium Authority Tribunal (CAT) is to create an online tribunal that helps settle and decide condominium-related disputes in Ontario. The online dispute process has three distinct components: online negotiation, online mediation, and an online tribunal decision where negotiation and mediation fail. The CAT was initially limited to making decisions regarding the disclosure of records, pets, vehicles, parking, and storage. This authority has since expanded to nuisances and includes odour, smoke, vapour, light, vibration, and noise. The CAT has its own rules of practice which can be found at the CAT’s website. The CAT renders decisions which are also available on the website and Canlii. The intention is to expand the CAT’s jurisdiction under the legislation to address and settle more disputes early in the conflict, including multi-party disputes.
In Alberta, the legislation provides that any dispute concerning a corporation’s by-laws or any matter arising under the legislation may, with the agreement of the parties to the dispute, be dealt with by mediation, conciliation, arbitration under the Arbitration Act or similar ADR mechanisms. Alberta’s legislation leaves room for the government to appoint a tribunal that may hear a dispute dealing with any matter specified in the regulations. When established, this tribunal is intended to have the same powers as a civil court with binding decisions. It is understood that Alberta’s tribunal will be established in phase 4 of its regulations project.
Manitoba similarly permits parties of a dispute to submit it to arbitration or mediation, provided the parties agree in writing to such a form of dispute resolution. Additionally, Manitoba’s legislation provides, in certain circumstances and if provided for in the declaration, that where the corporation and the owner do not agree as to the purchase price of his/her unit and common interest, the owner may elect to have the fair market value of his unit and common interest determined by arbitration by serving a notice to that effect on the corporation.
In circumstances where an owner disagrees as to the sale price of their unit (where they voted against the sale of part of the common elements, and the corporation is purchasing the owner’s unit), legislation in P.E.I., the Northwest Territories, Yukon, and Nunavut briefly mention arbitration between an owner and corporation.
In New Brunswick, the right to arbitration by an owner is related to the market price for the sale of the part of the common elements and not to the market price of the owner’s unit. The owner may elect to have its fair market value determined by arbitration.
With regard to mediation, in Manitoba, the tenant or the corporation may make an application under The Residential Tenancies Act to have the Director of Residential Tenancies investigate, endeavour to mediate a settlement, and determine a matter arising from an alleged breach of the declaration, by-laws or rules of the corporation by a tenant.
New Brunswick permits arbitration for disputes concerning the purchase price of the part of the common elements, and it permits arbitration for any dispute under its legislation between: (i) the corporation and an owner; (ii) the corporation and a manager of the condominium property; (iii) the corporation and any other corporation; and (iv) two or more owners. New Brunswick’s arbitration provisions are similar to Ontario’s in the sense that the disputing parties are deemed, for the purposes of the Arbitration Act, to have entered into an arbitration agreement for such dispute. However, in New Brunswick, the arbitrator is chosen by the Director of condominiums and not by the parties.
In Nova Scotia, disputes between the corporation and an owner over a very limited number of specified matters—essentially violations by the owner or tenant of the by- laws or rules, or a failure of the corporation to enforce the by-laws and rules—are heard by dispute officers appointed under the Residential Tenancies Act. Other disputes, including disputes between owners or disputes with a management company may be submitted by either party to arbitration under the Commercial Arbitration Act before an arbitrator appointed by the Registrar. If a tenant is in breach of the declaration, by-laws, or rules, the corporation gives notice to the owner to rectify the situation. If the owner fails to do so, the corporation can proceed directly against the tenant under the Residential Tenancies Act.
In its existing legislation, British Columbia allows a strata corporation, an owner or a tenant to refer a dispute to arbitration if the dispute concerns any of the following: (i) the interpretation or application of the Act, regulations, by-laws or rules; (ii) common property or common assets; (iii) the use or enjoyment of a strata lot; (iv) money owing;
(v) an action or threatened action; or (vi) the exercise of voting rights by a person who holds 50% or more of the votes at an annual or special general meeting.
A major overhaul to the ADR process in British Columbia came into effect in late 2016. The ‘Civil Resolution Tribunal,’ effectively provides an ADR process whereby collaborative, problem-based approaches are employed in place of traditional litigation- based resolution methods. The Tribunal has recently commenced, and it will largely be used in the settlement of small claims and strata disputes including damage claims, issues regarding common property, interpretation of the legislation and non-payment of monthly fees. It is hoped that all of this may be accomplished online without needing personal attendance.
In Saskatchewan, when there is a dispute between owners or between the corporation and one or more owners, the parties to the dispute may agree in writing to submit the dispute to arbitration by a single arbitrator under the Arbitration Act, 1992. The costs of arbitration are to be shared equally between the parties; an interest may be registered against the title to a unit for the amount of the owner’s share of the costs that remains unpaid.
Quebec does not provide any form of specific mediation or arbitration provisions relating to syndicates and co-owners. However, Quebec law generally permits parties to any dispute to agree to submit their dispute to arbitration.
(b) Oppression Remedies
The oppression remedy, despite its longstanding application to provincial and federal corporate law, has been implemented in condominium legislation in only a few Canadian jurisdictions. Generally speaking, the oppression remedy in traditional Canadian corporate law grants a court a broad remedial power to grant relief against any conduct by a business corporation that is “oppressive”, unfairly prejudicial, or unfairly disregards the interests of the applicant—typically a shareholder or other interested party. Due to its equitable nature, the oppression remedy involves court considerations that differ substantially from traditional legal remedies stemming from breach of contract, negligence, and tort claims.
Saskatchewan, Manitoba, and Ontario have included this type of remedy in their condominium legislation. They provide that an owner, a corporation, a declarant, or a mortgagee of a unit may make an application to the court for an order seeking relief from oppressive conduct by an owner, a corporation, a declarant or a mortgagee. The court may grant relief including an order prohibiting the impugned conduct (i.e. injunctive relief) and an order requiring the payment of compensation.
Interestingly, though the role of the oppression remedy in traditional corporate law is to prevent the corporation from engaging in unfair actions against shareholders and other stakeholders, Ontario has gone further and permits an application for the oppression remedy to be brought by the condominium corporation against an owner. This has started to become another enforcement tool for corporations against owners, as well as for claims by owners.
In Saskatchewan, the new oppression remedy section, section 99.2, permits "An owner, a corporation, a developer, a tenant a mortgagee of a unit or other interested person" to make an application to the court. They may seek relief based on oppressive conduct if "an owner, a tenant, a corporation, a developer or a mortgagee of a unit is or threatens to be oppressive or unfairly prejudicial…”.
The legislation does not preclude the oppression remedy from being invoked concurrently with other enforcement remedies, and it does not require the implementation of any other remedy as a condition precedent before the seeking the oppression remedy. Notably, it is not necessary to proceed first by way of mediation or arbitration (discussed at section 5(a), above) before seeking relief through the oppression remedy.
Currently, Saskatchewan and Ontario are the only jurisdictions that provide a full oppression remedy in their condominium legislation. British Columbia’s previous legislation had similar oppression provisions, but the current statute has narrowed the remedy. British Columbia. now provides that an owner or tenant may apply to the court to make any interim or final order the court considers necessary to prevent or remedy the following: (i) a significantly unfair action or threatened action by, or decision of, the corporation; or (ii) a significantly unfair exercise of voting rights by a person who holds 50% or more of the votes at an annual or special general meeting. The court may also, on application by an owner, tenant, or mortgagee, order the corporation to perform, or to cease contravening, the legislation, by-laws, or rules.
Alberta courts can deal with allegations of improper conduct by a corporation, director, owner, or developer. Improper conduct is defined to include non-compliance with the Act or by-laws, conduct or exercise of powers that is oppressive or unfairly prejudicial or that unfairly disregards the interests of an interested party. The court can appoint an investigator, give directions, award compensation and costs or give other appropriate orders.
Lastly, Quebec provides co-owners the ability to seek similar remedial relief from the court. An owner has the right to address the court within 60 days following a meeting to void a decision of the assembly based on: (i) a decision of the assembly being biased;
(ii) a decision taken with intent to injure the co-owners or in contempt of their rights; or
(iii) an error made in counting the votes.
All other jurisdictions are silent on the availability of the oppression remedy, or any analogous power of the court, to remedy similar unfair acts.
6. Other Matters
(a) Forms of Condominium Corporations
Ontario sets out two principal types of condominium corporations: (i) “freehold condominium corporations”, where the ownership (freehold) interests in the condominium property are divided into individual units and common elements, and (ii) “leasehold condominium corporations”, where the leasehold interests in the condominium property are divided instead.
In addition to the more common “standard” freehold condominium corporation, which entails a building and land subdivided as above, in Ontario there are several additional subtypes of a freehold condominium corporation:
- “Common elements condominium corporation”, where the corporation has common elements only, without any individual units. In this case, the common elements and the corporation are “tied” to the non-condominium parcel of land (the home). This is registered on title of the home and is often called the “POTL” (parcel of tied land). One often sees this form of condominium corporation in the case of a golf course and housing development, where the golf course is the corporation and is tied to each of the surrounding homes.
- “Phased condominium corporation”, a variant of the standard freehold condominium corporation, which allows the addition of new phases of the condominium, containing new units or common elements.
- “Vacant land condominium corporation”, where (as the name suggests) no building or structure exists on the land. However, there is an obligation of the purchaser to build a home within a stipulated period of time.
With regard to a phased condominium corporation, the declarant may create additional units or common elements (a “phase”) after the registration of the declaration and description, provided that: the corporation is a phased condominium corporation, and the declaration so indicates; the description describes the land owned by the declarant not included in the phase; and the board has been elected at a meeting of owners held when the declarant did not own a majority of the units.
New phases to the corporation are created upon the registration of an amendment to the declaration and description. The process is quite complex, and the amendment has numerous requirements as to its content.
Similar to Ontario, the legislation in Newfoundland and Labrador permits “common elements condominium corporations”, “phased-development condominium corporations”, and “vacant land condominium corporations”.
British Columbia allows “leasehold strata plans”, “phased strata plans”, and ‘bare land strata plans”, which are generally similar to their Ontario counterparts.
Alberta and Saskatchewan also allow for the development of condominiums in phases. Alberta has conventional condominiums, bare-land condominiums, barely blended condominiums (developed by practice but not in legislation), and phased condominiums. Where a plan is registered as a condominium plan under which it is to be built in phases, the plan must be accompanied by a phased development disclosure statement that is registered as part of the condominium plan. The development of the phases is subject to numerous other statutory requirements. Saskatchewan allows for bare-land condominium corporations as a distinct type or category.
Manitoba has implemented amendments to its condominium legislation to permit phased condominiums. As with the other jurisdictions which contemplate phased condominiums, the legislation imposes detailed and complicated requirements for registering a phase.
New Brunswick and Nova Scotia have only one form of condominium corporation but distinguish between the categories of property associated with the corporation, each of which has different requirements. The legislation classifies condominium properties into commercial, residential, bare-land, mixed-use, and phased-development. Similarly, Alberta permits “bare-land units” within a condominium, though without treating such condominiums as a distinct type.
In New Brunswick, phased-development projects are slightly different in that every time a phase is added, the common property around the buildings expands to include all new buildings until the whole proposed land in the project is contained at the last phase. They are not separate entities to be joined together at the end.
The Northwest Territories, Nunavut and P.E.I. permit leasehold condominiums in addition to freehold condominiums.
Nova Scotia’s legislation states that a phased-development condominium is exempt from the subdivision-approval requirement if it meets all prescribed requirements. The acceptance of such constitutes a subdivision of land and creates a lot as described in the description of that phase.
(b) Disclosure Statement
The “disclosure statement” is a document that the declarant (most often, the condominium developer) must provide to prospective purchasers (and in Manitoba, may also apply to a certain degree in sales by other sellers), allowing the prospective purchaser to make an informed decision about buying a unit. The disclosure statement usually includes, among other things, whether the corporation is a freehold condominium corporation or a leasehold condominium corporation, a general description of the property, and whether a building on the property or a unit or a proposed unit has been converted from a previous use.
Both Ontario and Manitoba have extensive legislative provisions dealing with the disclosures and documents that must be provided to the prospective purchaser. The agreement of purchase and sale of a unit is not binding on the purchaser until the declarant has delivered all the documents required by the legislation, including a disclosure statement, to the purchaser. In Ontario, the declarant must also deliver a condominium guide created by the minister along with the disclosure statement.
The legislation of both provinces provides a “cooling-off” period of 10 and 7 days, respectively, after the purchaser receives all of the required disclosure documents (or after an amended statement has been received due to a material change(s)). During this time the purchaser can terminate or cancel the purchase for any reason, before accepting a deed or transfer to the unit. Alberta has similar disclosure provisions.
In Quebec, a promoter selling a unit must provide the prospective purchaser with a memorandum containing information including a description of the building, the professionals involved in its construction, and the budget and management of the building. It must also provide a copy or summary of the condominium’s declaration.
British Columbia’s legislation does not provide for a similar disclosure requirement to that of Ontario’s, but it makes reference to “rental disclosure statements,” which are only required when an owner-developer rents or intends to rent one or more residential strata lots. However, with the adoption of Bill 44 on November 24, 2022, it is understood that all rental restriction by-laws became unenforceable, and the need for rental disclosure statements by developers became academic.
The Saskatchewan, New Brunswick, Nova Scotia, P.E.I., and Northwest Territories statutes, as well as the legislation in Newfoundland and Labrador, similarly require certain information to be provided to the prospective purchaser from the declarant for the agreement of purchase and sale to become binding on the parties. However, P.E.I. does not specifically provide for a “cooling-off” period. Rather, it provides that 10 days prior to delivering a deed, the declarant must deliver to the purchaser a further copy of each document or instrument required by the legislation or a confirmation that the document or instrument is identical to a corresponding document previously received. As is the case in Ontario, other provinces and territories including Nova Scotia, New Brunswick, Newfoundland and Labrador, the Northwest Territories, and Saskatchewan all provide a 10-day “cooling-off” period after receipt of the information.
Alberta legislation also states that when a plan is registered as a condominium plan under which a building or land is to be developed in phases, the plan, at the time when it is registered for the initial phase, must be accompanied by a phased development disclosure statement that is registered as part of the condominium plan. Alberta legislation also provides the purchaser with a 10-day “cooling-off” period from the date of execution. (Phased condominiums are discussed further at section 6(a), above.). Alberta developers are required to provide a disclosure binder to purchasers containing several documents, including the proposed budget, proposed plan, proposed management agreement, the floor plan of the unit, description of facilities and landscaping, etc.
Neither the legislation in the Yukon nor Nunavut makes any specific reference to disclosure statements.
(c) Shared Facilities
Only Ontario uses the terminology “shared facilities”, although it is not formally defined. The term “shared facilities” covers any facilities or services shared by two or more corporations. The term includes recreation centers, utility systems, parking lots and other such facilities that are capable of being shared. The relationship between two or more corporations that share facilities is usually governed by a “mutual use agreement”, “shared facilities agreement” or “reciprocal cost-sharing agreement”. The agreement sets out the terms governing the mutual use, provision, maintenance and/or cost- sharing of facilities or services between the parties. In Ontario, the boards of the corporations may periodically make, amend or repeal joint by-laws or rules governing the use and maintenance of such shared facilities, and the owners’ approval of these must comply with the legislation.
Similar to the Ontario concept of “shared facilities”, Quebec provides for the sharing of “common services”. Although “common services” is not defined, a syndicate may join an association of co-ownership syndicates formed for the creation, administration, and upkeep of common services for several immovables held in co-ownership or for the pursuit of common interests.
In Manitoba, a condominium corporation may enter into a “mutual use agreement”, which is defined under the legislation.
The other jurisdictions do not have similar legislative provisions to that of Ontario and Quebec regarding the use and governance of shared facilities.
(d) Amalgamation of Corporations
Many jurisdictions allow condominium corporations to amalgamate. Each jurisdiction has different requirements and procedural steps that must be followed.
In Ontario, the regulations restrict amalgamation to two or more standard condominium corporations: a freehold condominium corporation that is not a vacant land or a common elements condominium corporation. Phased condominium corporations may only amalgamate once all phases are completed.
Amalgamation is affected by registering a declaration and description amalgamating the corporations, provided the board of each has held a meeting and the owners of at least 90% of the units have consented in writing within 90 days of the corporation’s meeting. The amalgamation occurs by completing the strict procedural steps and ultimately registering an amalgamating declaration and description. It is a complex and expensive process; while it was designed to solve a problem in the condominium industry, it has rarely been attempted.
In Saskatchewan, New Brunswick, Nova Scotia, and the Northwest Territories, two or more corporations may amalgamate. In New Brunswick, amalgamation may only occur if the properties are contiguous (adjoining parcels of land). The board of each corporation must call a meeting of all owners and mortgagees to approve the amalgamation. The board of each corporation shall provide all owners and holders with notice of the meeting, as well as a copy of the proposed condominium plan and by-laws, a statement indicating the number of “unit factors” to be allotted to each unit (their relative sizes), an estoppel certificate, a statement setting out the priority to be given to each of the registered interests with respect to the common property and the units that are affected by the amalgamation, and any other necessary documentation.
In Saskatchewan, the consent of 80% of owners and mortgagees is required for amalgamation of corporations. This consent can be obtained in a meeting in person, by proxy, by signature on a resolution, or any combination of those options. Any non-consenting owner or mortgagee may make an application to court to prevent the amalgamation.
The corporations of Nova Scotia and the Northwest Territories must obtain the consent of at least 80% of all unit owners and mortgagees. In Saskatchewan, if decided at a meeting of owners (in person or by proxy) then unanimous consent must be achieved, and, if by written consent, then the consent of 80% of all unit owners is required. Any consent is subject to the right of challenge by the owner.
Legislation in Manitoba and Newfoundland and Labrador similarly requires the corporation to provide the owners with certain documentation to allow them to make an informed decision regarding the amalgamation. Once a meeting has been called and the owners have received all the required information, then owners of at least 80% of the voting rights in the amalgamating corporation must consent in writing to the amalgamation proposal. To affect an amalgamation, the proposed declaration and by- laws for an amalgamated corporation must be submitted to the district registrar for registration in the appropriate Land Titles Office.
A difference in Alberta’s legislation is that 30 days’ notice must be given for the corporation’s meeting, and 75% of the owners representing 75% of the unit factors must approve the amalgamation. Within 6 months from the day that the Registrar registers the amalgamation, the amalgamated corporation must, for the purpose of electing a board, convene a meeting of the persons who are entitled to vote pursuant to the Act.
Under British Columbia’s legislation, a 75% vote by each of the corporations at an annual or special general meeting is required to approve the amalgamation.
In New Brunswick, the owners of at least 60% of each corporation must vote in favour of the amalgamation.
In Quebec, the only way to join two or more syndicates is to terminate each one and recreate a new syndicate. Termination requires the approval of 75% of the co-owners and 90% of the voting shares of all co-owners, plus the consent of 100% of all hypothecary creditors.
7. Conclusion
Despite their many similarities, Canadian condominium legislation display great diversity and they remain in a state of constant change. Since the first edition of the Primer was published, Saskatchewan, Manitoba, New Brunswick and Newfoundland and Labrador have completely overhauled their condominium legislation. Ontario’s reformed legislation, the creation of the CAO and the CAT, along with the legislation for the licensing and regulation of condominium property managers, and the creation of the CMRAO, have been in force since November 1, 2017. In addition, Alberta is developing its regulations in 4 phases.
CCI’s National Government Relations Committee will continue to monitor these legislative changes and seek to participate in shaping them to further CCI National’s mandate is to represent the interests of condominium stakeholders and support the condominium industry. In drafting reforms, lawmakers have often looked to what has already been tried in other provinces. Cross-Canadian legislative comparisons such as this may not only describe today's landscape but also help point the way to possible future legislative directions.
On behalf of the CCI National, we hope that this summary has helped give a brief tour of Canada’s condominium legislation. We invite your comments and suggestions.
1 New Brunswick requires a vote of 60% of the ownership of common elements; in Nova Scotia, it is 66⅔% of the members in attendance at the meeting,
2 This subsection originally contributed by Barry R. Scott, of Scott Petrie Brander Wright & Bell LLP, London, Ontario, and updated through contributions from CCI members from across Canada. In addition, in 2019, CCI National’s GR Committee prepared a chart comparing the insurance regimes in each province, through contributions from CCI members from across Canada.
3 I highly recommend reviewing the material from the CCI symposium “Insuring Condominiums – Current Issues” (May 25, 2005), which deals with most of the critical insurance issues in much greater depth than can be done in this Primer. A good starting point is Chapter 4, by Rob Giesbrecht, which discusses the general legal framework.
Appendix - Table of Legislation
The following is a table of the name, and citation of the legislation and regulations of each jurisdiction, including their date of last amendment and number of sections.
| Provinces/ Territories | Legislation | Regulations | Last Amended | Number of Sections |
|---|---|---|---|---|
| Newfoundland and Labrador | Condominium Act, 2009, S.N.L. 2009, c. C-29.1 |
Condominium Regulations, C.N.L.R. 955/96 |
Act: 2022 Regulations: 2001 |
Act: 21 2009 Act: 93 Regulations: 9 |
| New Brunswick | Condominium Property Act, S.N.B. 2009, c. C-16.05 |
General Regulation, Condominium Property Act, N.B. Reg. 2009/169 |
Act: 2012 and 2015 Regulations: 2012, 2015 and 2017 |
Act: 77 Regulations: 38 + 16 forms |
| Nova Scotia | Condominium Act, R.S.N.S. 1989, c. 85 | Condominium Regulations, N.S. Reg. 60/71 | Act: 2023 Regulations: 2023 |
Act: 76 Regulations: 83 + 2 schedules + 28 forms |
| Prince Edward Island | Condominium Act, R.S.P.E.I. 1988, c. C-16 | General Regulations, P.E.I. Reg. EC10/78 | Act: 2009 Regulations: 2009 |
Act: 36 Regulations: 66 + 4 schedules + 18 forms |
| Quebec | Civil code of Québec S.Q. 1991, ch. 64 (Book 4, Title 3, Chapter III: Divided co- ownership of immovables) | None | Act (for co- ownership): 2002 | Act (for co- ownership: 72 (CCQ, arts. 1038 – 1109) |
| Ontario | Condominium Act, 1998, S.O. 1998, c. 19 |
a) Description and Registration, O. Reg. 49/01 |
Act: 2023 Regulations: a) 2022 b) 2023 |
Act: 188 Regulations: a) 53+15 forms b) 78+15 forms |
| Manitoba |
The Condominium Act, C.C.S,M., c. C170 https://web2.gov.mb.ca/laws/ statues/ccsm/c170e.php#202 |
Condominium Regulation 164/2014 |
Act: 2015 Regulations: 2015 |
Act: 311 |
| Saskatchewan | Condominium Property Act, 1993, S.S. 1993, c. C-26. 1 | Condominium Property Regulations, 2001, R.R.S. c. C-26.1 Reg. 2 |
Act: 2013 Regulations: 2016 |
Act: 115 Regulations: 70 + 38 forms + 1 table |
| Alberta | Condominium Property Act, R.S.A. 2000, c. C-22 Condominium Property Amendment Act, 2014 SA 2014 c10 | Condominium Property Regulation, Alta. Reg. 168/2000 |
Act: 2009 Regulations: 2006 |
Act: 81 Regulations: 82 |
| British Columbia | Strata Property Act, S.B.C. 1998, c. 43. |
a) Bare Land Strata Regulations, |
Act: 2009 Regulations: a) 2010 b) none c) 2018 |
Act: 322 + schedule Regulations: a) 21 b) 4 c) 18 + 26 forms |
| Northwest Territories | Condominium Act, R.S.N.W.T. 1988, c. C-15 | Condominium Regulations, N.W.T. Reg. 098-2008 |
Act: 2011 Regulations: none |
Act: 31 Regulations: 15 |
| Yukon | Condominium Act, R.S.Y. 2002, c. 36 | Condominium Certificate of Title Form, Y.C.O. 1977/101 | Act: 2003 Regulations: none |
Act: 25 Regulations: 2 |
| Nunavut | Condominium Act, R.S.N.W.T. 1988, c. C-15. | Act; 2010 Regulations: |
Act: Regulations: |
DISCLAIMER, USE INFORMATION AT YOUR OWN RISK
This is solely a curation of materials. Not all of this information is created, provided or vetted by CCI. Some of the information is only applicable to certain provinces. CCI does not make any warranties about the reliability or accuracy of any information found in the materials on this website. The information is not updated to reflect changes in legislation or case law and therefore may not always be current and up-to-date. We suggest you seek professional advice with respect to your specific issues or regarding any questions that arise out of the material. We will not be liable for any losses or damages in connection with the use of any of the material found on the website.
Back to Results Back to Overview