Only specific relatives can be on title for HST rebate

Post by: Evan Holt

The HST new homebuyer’s rebate entitles qualified purchasers to a substantial rebate. The maximum federal and provincial portion of the rebate is $6,300 and $24,000 respectively.

A Tax Court of Canada decision released at the end of March has further clarified who can qualify for the rebate.

“[T]itle may be held by the buyer jointly with a specific blood relation, including a child and grandchild, a brother or sister, and relationships by marriage or common-law partnerships — even if the relative doesn’t live in the house.”

Here, an uncle was on title with his niece for mortgage financing purposes. As this relationship is not a category recognized by the legislation the purchaser did not qualify for the rebate.

“This means that if just one of the buyers does not qualify, even as the owner of a one percent interest in the property, none of the buyers can get the rebate.”

For the full Toronto Star article click here.


Post by: William Thompson


Recently, we have had more clients building mid and high rise condominiums apartment buildings with the intention of retaining title to the entire building and renting the suites.  When a developer decides to keep title to the building for rental purposes, the developer assumes the role of landlord and enters into the realm of tenant protection legislation.  Now, one expects tenant protection legislation to impact matters such as rental rates and increases but one wouldn’t expect it to impact decisions around building design and construction.  However, recently we encountered a regulation with respect to billing tenants for electricity consumption that every rental property owner or developer needs to know.  It is important to emphasize that this legislation potentially applies to all forms of rental buildings, regardless whether the residential suite in question is a condominium, townhome, single family home or suite in an apartment building.

The Legislation

In subsection 40 (3) of Regulations 389/10 to the Energy Consumer Protection Act, 2010, it provides that:

(3)  A suite meter provider shall not bill an occupant of a rental unit or a member unit based on the consumption or use of electricity by the occupant in respect of the unit, as measured by a suite meter, if,

(a) the suite meter was installed after the day this section comes into force but is not deemed under subsection 43 (2) to have been installed after the day this section comes into force;

(b) the unit is heated primarily by electricity; and

(c) the electricity measured by the suite meter includes the electricity used in heating the unit.

In simple terms, what this subsection is saying is that if electricity is the primary heat source for a rental suite constructed after 2010, the landlord of the unit will not be able to use a single hydro meter to meter electricity consumed in the suite and bill the occupant for such consumption.  The logic behind this provision is highly questionable and now with the proliferation of packaged terminal air conditioner (PTAC) units providing heat, many of which are electric, it is a problem for developers.

Essentially, a developer has four choices if the developer chooses to heat a rental suite with a PTAC unit:

  • install a natural gas PTAC system if feasible given the building design and budget;
  • install two hydro meters, one to measure electricity consumption by the PTAC system and the other to measure consumption by the lights, plugs, appliances etc. and bill the tenant for both amounts;
  • separately measure and bill the consumption by the lights and plugs etc. in the residential suite with a single meter that does not measure the consumption of electricity by the PTAC system and include an estimate of the consumption by the PTAC system in the base rent; or
  • include all electricity consumed by the tenant in the base rent for the residential suite.

Obviously none of these options are ideal.  In particular, there is a significant cost to having two meters.  On the other hand, options (c) and (d) add exposure to the developer, especially as the PTAC systems are typically controlled within the residential suite and the rent cannot vary based on actual consumption.

And while none of the solutions are ideal, at least if a developer is aware of the issue, the developer can determine the best course of action during the planning stage of the building and avoid nasty surprises after the fact.

As noted, it is difficult to understand the thinking behind this provision.  Options (c) and (d) do nothing to encourage conservation by tenants and impose risks on the developer that to a large extent are controlled by the tenant because the tenant will likely control the level of heating and cooling in the residential suite.  Options (a) and (b) may not be feasible or cost effective.  Regardless, developers need to be aware of the legislation and the impact it could have on their building and future operations.

Parkland Dedication Fees Capped by Ontario Municipal Board

Post by: Roy Gentles

Parkland dedication, or cash-in-lieu of land, has been a hotly debated topic between municipalities and developers for years.  In a decision dated January 15, 2015, the Ontario Municipal Board (“OMB”) sided with developers saying that the Town of Richmond Hill’s parkland dedication rate, the cash-in-lieu equivalent argued to be $37,600 per unit, was too high.

The OMB ruling imposes a cap on how much the town can charge on new development: 25 per cent of the land being developed, or its value in cash.

“No matter how many units there are on the site, they are going to pay the same amount,” said Bassios. “The cap removes any relationship between a density increase and the parkland that they owe,”

With an appeal to the to the divisional court likely, this is a case we will be watching closely.

For the full Toronto Star article click here.

Choosing a Condo Plan That is Right for You – Part 4: Common Elements Condominiums

Post by: Roy Gentles


In our previous blog post we discussed phased standard condominiums.  In this post we will offer part one of our discussion on common elements condominiums.


Common Elements Condominium Plans

A common elements condominium plan (“CECP”) refers to a condominium plan where the condominium property consists only of common elements.  As such, there are no condominium units in CECPs.  Instead of owning a unit in the condominium plan, as one would see in other types of condominiums, each owner in a CECP owns an undivided interest in the common elements of the CECP.  Ownership of an undivided interest in the common elements of the CECP occurs when the owner of a piece of freehold land outside of the proposed CECP consents to having  his or her land “tied” to the CECP.  This consent is obtained at the time the CECP is being established.  The owner’s freehold piece of land so tied to the CECP is referred to as a Parcel of Tied Land (“POTL”).

The POTLs tied to a CECP take the place of units for most purposes in the legal structure of a common elements condominium.  However, the POTLs are not part of the CECP; the POTLs have and retain freehold tenure.

An example can help clarify how a CECP can be used.  For this example, a developer wants to build a residential development with single family dwellings on half acre freehold lots and does not want to bring those lots into a condominium plan. The developer also wants to allow the owners of the freehold lots the use of a shared recreational facility, such as tennis courts.

The developer has decided for marketing or other reasons it would be beneficial to sell the homes as freehold estates instead of selling the homes as condominium units.

However, the developer, or the municipality which has to approve the development, is worried that the recreational facility will not be properly taken care of over the long run and, instead of adding value to the development, will detract value from it if the recreational facility is not under the jurisdiction of a condominium.  The main concerns facing the developer or municipality are usually: 1) how is this recreational facility to be governed; and 2) how will the recreation facility be properly funded over the long term.  Including the recreational facility in the CECP resolves these concerns.

In this example the recreational facility could be registered as the common elements of a CECP.  The lots containing the single family dwellings would become the POTLs to the CECP.  The owners of each single-family freehold home (the POTL)  would own a freehold estate in his or her home and an undivided interest in the common elements condominium, which consists of the recreational facility.

The common elements condominium corporation, which is automatically created upon registration of the CECP, would :

  • manage the recreational facility;
  • be responsible for the maintenance and repair of recreational facility; and
  • collect the monies necessary to operate the recreational facility and to properly fund the recreational facility reserve fund from the owners of the POTLs.

The owners of the POTLs are obligated, on the same basis as if such owners were the owners of condominium units, to pay common expenses on account of costs of operating the CECP and to fund the reserve fund of the CECP as needed.  As the POTLs are not part of the CECP, no costs related to the POTLs become part of the condominium budget.

CECPs are often useful in providing parking or in providing an access roadway to freehold parcels of land that do not otherwise have adequate legal or physical access to a public street.  In this circumstance, only the parking lot or the roadway that leads to the freehold parcels of land would be in the CECP.

Take Home: Pros and Cons of Common Elements Condominium Plans

The greatest advantage of a CECP is allowing a developer to provide a shared feature or facility to a group of freehold parcels of land and have that shared feature or facility governed by the provisions of the Condominium Act.  This ensures the governance of the shared feature or facility is regulated by the provisions of the Condominium Act and also ensures there are sufficient funds available to maintain, operate, repair and replace the shared feature or facility.

If the owner of a POTL fails to pay the common expenses attributable to his or her freehold parcel of land, the common elements condominium corporation has the right to register a common expense lien against the POTL.  A common expense lien is a first charge against the POTL, ranking ahead of any mortgages on the property if properly processed.

The shared features or facilities in a CECP can include anything a developer seeks to have shared by the owners of the parcels of land.  The most usual shared features and facilities are items such as access roads, parking facilities, recreational facilities, other amenities, retaining walls and/or noise walls.

Common expenses for common elements condominiums are usually much less than in other types of condominiums because the common expenses are only on account of costs relating to the shared facility, not the POTLs.  As discussed in our blog on phased condominiums, currently only standard condominiums can be phased, therefore a developer is forced to register the entire CECP at one time. It is usually not practically possible to add POTLs to a CECP once the CECP is registered.  It is also important to note that POTLs cannot be subdivided without an amendment to the condominium declaration.  It is however possible, in some circumstances, to register a new condominium on top of a POTL.

In part two of our discussion on CECPs, we will look at how CECPs are treated under the Ontario New Home Warranties Plan Act  and discuss some other aspects of such plans.

Choosing a Condo Plan That is Right for You – Part 3: Phased Condominiums

Post by: Carly Haynes

Our previous blog post discussed standard condominiums. This week we will offer a discussion on a specific type of standard condominium, phased condominiums.

Phased Standard Condominium Plans

As the name suggests, a phased condominium plan is a condominium plan that is developed and registered in stages.  Currently the Condominium Act, 1998 (the “Act”) only allows standard condominiums to be phased.  In phased condominium projects, there is one condominium plan which is expanded through amendments to the condominium declaration and description plans, with each new registration constituting a phase as new units are constructed. The condominium plan gradually increases in size as phases are added until the project is complete.  This type of project is attractive to builders  as they are able to balance sales of the units and registration of additional phases in order to ensure the project does not become over-extended.  After each phase is registered the builder can complete the closing of the units in that phase which allows the builder to obtain sales proceeds to assist in constructing the next phase.

The registration of the condominium declaration which brings the first building(s) into the condominium plan is not the first phase. Our office usually refers to this first registration as the Initial Registration.  The first “phase “is the next registration after the Initial Registration.  Needless to say this causes confusion.  Most people quite logically assume the Initial Registration is the first phase.  It isn’t.

References in this blog to a “declarant” mean the person/company that registers the condominium.  Often the builder is the declarant.

Typically phased condominium plans are made up of town homes but there are many examples of phased apartment building condominium plans and single family home condominium plans.

When considering undertaking a phased condominium project, it is important to note the first phase cannot register until title to the majority of the units in the Initial Registration of the condominium plan are no longer owned by the declarant and the declarant has delivered certain documents to the condominium corporation pertaining to the phase to be registered (this requirement applies to the first phase only, not subsequent phases). Furthermore, a phase cannot be registered until all facilities and services have been installed as required by the municipality to ensure  the phase being added to the condominium can function properly even if the planned additional phases are never added to the condominium.


Phase Disclosure

There are specific disclosure provisions for phased condominiums. Section 147 of the Act requires that all purchasers be provided with disclosure statements which provide specific information on phasing, including whether the declarant intends to create one or more further phases, the projected timing of registration of subsequent phases and details regarding units, location of buildings etc.

The Act permits the condominium corporation to apply for injunctive relief or damages if the declarant proposes certain changes to the proposed phase from what was disclosed in the disclosure statement which are “material and detrimental”.  This type of application could result in significant delays for a declarant, and as such a declarant  who is uncertain about future plans for future phases should fairly and completely disclose all options for the project that the declarant is considering in its disclosure statement to purchasers to reduce the chances of this complication.

A successful injunction application by a condominium corporation does not necessarily preclude the registration of the proposed phase.   It may simply mean the proposed phase will have to proceed as a separate condominium.  The approval authority may have concerns with this result but if the declarant has carefully drafted the condominium documents with proper cross easements between the registered condominium and the lands being held for future phases the problem should not be insurmountable.

Take Home: Pros and Cons of Phased Condominium Plans

The most substantial benefit of a phased condominium plan is that phasing eliminates the requirement to have all proposed buildings in a standard condominium plan completed before the condominium plan can be registered.  This allows a builder to build and close units in segments (and get proceeds of these sales) rather than having to wait for all of the proposed units in the condominium to be constructed before registering the condominium plan and transferring title to purchasers, allowing the declarant to start paying down their construction loan.  This can dramatically reduce the amount of the declarant builder’s construction loan as he or she is only borrowing enough at any one time to build part of the proposed development.

A phased condominium can allow a declarant to post less security with Tarion.   Rather than having to post security for the whole development (possibly at $20,000 per unit), the declarant is only required to post security for the units in the proposed phase.  This is subject to the declarant not entering into any agreement of purchase and sale for units in phases not covered by Tarion.

The only significant drawback  associated with phased condominiums is increased costs on multiple fronts for each phase due to the costs related to the registration of multiple phases, including application and approval fees, planner, lawyer, engineer and surveyor fees.

Finally, the individual unit sales agreements cannot be closed until the unit is built and registered within the condominium. As such, in order to justify the costs associated with each new phase, a sufficient number of agreements of purchase and sale need to have been entered into for the proposed units in the new phase. However, it often makes more financial and practical sense to create a phased condominium instead of multiple condominiums.

Choosing a Condo Plan That is Right for You – Part 2: Standard Condominiums

Post by: Carly Haynes

Standard Condominium Plans

Our previous blog post offered an introduction to vacant land condominium plans.  In this post we will examine standard condominium plans.

What is a Standard Condominium Plan?

A standard condominium plan is the traditional form of condominium that people tend to be most familiar with. Under previous condominium legislation in Ontario, only standard condominium plans could be created, as such, all condominium plans registered prior to May 5 2001 are standard condominiums.  Under Ontario’s new legislation, the  Condominium Act 1998 (“the Act”), a standard condominium plan is any condominium that is neither a leasehold condominium, nor any of the other types of freehold condominiums provided for in the Act (for example: common elements condominiums or vacant land condominiums).

Defining something by what it is not may not be very helpful, so what exactly is a standard condominium?

This type of condominium plan is typically comprised of completed buildings which are made up of units and common elements.  Some common elements, for example patios attached to the units, may be deemed exclusive use portions of the common elements, meaning that use of those spaces is reserved for specific unit owners only.  Other common elements may include exercise rooms, recreational facilities, roadways, green space and walkways. Notably, some units in a standard condominium can be left empty at the time of condominium registration, such as parking units, or units intended for commercial or industrial (not residential) use.

Finally, prior to the registration of a standard condominium plan all proposed buildings within the plan must be constructed to the level required by the Act regulations, which is also what forms the basis of “Schedule G” of a standard condominium plan.  Schedule G includes an engineer’s or architect’s certificate (or combination), as to the status of the construction of the condominium’s buildings. A completed Schedule G must be included as part of the condominium declaration in order for the declaration to be registered along with the description plans.


Why Develop a Standard Condominium Plan?

One benefit of standard condominiums is that proposed standard condominium units can be marketed to potential unit purchasers prior to obtaining draft plan approval from the approval authority (this is also the case with common elements condominiums and phased condominiums).

Also, pursuant to the regulations, the municipality is not required to provide notice of a public meeting for the approval of a standard condominium plan to the surrounding community nor is any circulation to any agencies required. This factor may increase the efficiency of the development.

The Downside of Standard Condominium Plans

The buildings in a standard condominium plan must all be built at one time, without phasing, therefore substantial construction capital may be necessary at the outset of a project, especially if marketing of the units is slow. Phasing the condominium plan offers a solution to this issue, and will be discussed in the following blog.

Finally, pursuant to the Tarion New Home Warranties Act a developer is required to post security to enroll the condominium in Tarion. Registration with Tarion must occur at least 30 (thirty) days before construction begins.

In our next blog post, we will discuss phasing of  standard condominium plans.

Choosing a Condo Plan That is Right For You- Part 1 : Vacant Land Condominiums

Post by: Carly Haynes

Ontario’s Condominium Act, 1998( “the Act”) provides for different types of condominiums, which in turn allows developers to utilize a condominium plan which is best suited to their needs. These variations include vacant land, leasehold, common elements and standard condominiums.  Only standard condominiums can be phased although there is hope the 002ability to phase condominium plans will be extended to other types of condominium in the expected updates to the Act.  The type of condominium development undertaken by a developer will vary based on a range of factors including the type of interest held in the land, intended future use and development plans.  It is important to be aware of the various positive and limiting aspects of each form of condominium when undertaking a development project in order to insure an efficient and successful project.

Vacant Land Condominium Plan

A vacant land condominium plan (“VLCP”) refers to a condominium plan that contains at least one unit with no structures on it at the time of registration of the declaration and description (the documents that are registered to create the condominium).

A VLCP allows the condominium plan to be registered on the land before structures are constructed on all of the units. In other words, what usually presents as a vacant “lot” is the unit, and the common elements are made up of any other parts of the plan outside the units such as for example, roads, visitor parking, sewers, recreational facilities etc.

Pursuant to the Act, the following qualifications must be met in order to register as a VLCP:

1.         No unit in a VLCP can be part of a building;

2.         If at the time of registration of the condominium, a unit in the VLCP contains any structure, the structure must be within the boundaries of the unit and cannot “straddle” a unit boundary. For example, a foundation for a town home block cannot be in place at the time of the registration of the vacant land condominium plan as it would constitute a structure crossing a unit boundary; and

3.         Units in a VLCP cannot be stratified. This restriction does not preclude the construction of multi storey buildings on units in a VLCP.  Rather, it prevents having units above or below each other.

VLCPs are generally intended for the development of units containing single buildings, whether they happen to be residential, commercial or industrial.    However, town homes can be constructed on a vacant condominium plan.  The foundations cannot be put in place until after condominium registration because of wording in the regulations to the Act.

If there are incomplete common elements at the time of condominium registration the municipal approval authority may allow the condominium plan to be registered but the approval authority is obligated to take sufficient security from the developer to ensure the common elements will be completed at a later date.

Money Matters

As any experienced developer will tell you, Tarion New Home Warranty enrollment fees for condominium projects represent a significant cost for residential developments.  Tarion can require security of up to $20,000.00 for each proposed condominium in a standard condominium plan.  The good news in regards to VLCPs is that Tarion treats these condominium units as a freehold homes, therefore no Tarion security is necessary for the common elements in the condominium. That being said, while Tarion doesn’t provide any warranty on the common elements of a VLCP, it will in almost all cases continue to apply to the new homes which are constructed on the units.

Upon completion of construction of the buildings on the condominium units, maintenance and repair obligations regarding each unit fall to the owners of the unit, not the condominium corporation.  The Act prohibits the condominium from doing any maintenance or repairs with respect to a vacant land condominium unit unless the owner fails to do so.

The Act also makes all insurance obligations with respect to the unit the responsibility of the unit owner.  While the unit owners are responsible for the units themselves, the vacant land condominium corporation remains responsible for the common elements.

Take Home

Positive aspects of VLCPs include:

  • registering the whole condominium at one time, prior to building
  • sales agreements for new homes on a VLCP can be closed as soon as construction is completed because the unit is already registered within the condominium; and   The builder does not have to wait for condominium registration or a phase to register.
  • developers are not required to post security to Tarion to enroll the condominium in Tarion.

The downsides of a VLCP include:

  • certain municipalities may be wary about foundation walls being situated on lot lines (see requirement #2 above) after condominium registration .
  • all units must be registered at once, and once registered the lot and parcel sizes are fixed;
  • no sales agreements can be finalized until the draft plan of approval of the proposed condominium is complete and construction cannot begin for any structure (such as town home) that will straddle a unit boundary until the condominium plan is registered, meaning all conditions placed on the draft plan must be met prior to such construction.  Single family home construction that will not straddle a unit boundary is not affected by this restriction. ; and
  • the inability of the condominium to insure any part of the units may result in the buildings having inadequate insurance which can result in serious repercussion in the event of a fire or other damage particularly if the units are semi-detached homes or townhomes.

In Part Two of this blog series we will discuss the pros and cons of standard phased condominiums.

Quorum oh Quorum

Post by: Meghan MacDonald

We have noticed lately that it is becoming difficult to obtain the required quorum of unit owners at condominium turnover meetings.  The purpose of the turnover meeting is for the Declarant of the condominium to hand over control of the condominium to the unit owners and in particular, elect a new board of directors to replace the directors appointed by the Declarant.  This meeting must take place once the Declarant ceases to own a majority of the units in the condominium pursuant to Section 43 of the Condominium Act, 1998.

This lack of attendance at turnover meetings by unit owners may be due to the fact that more and more condominium units are being purchased by investors who are not as concerned about the day to day operations of the condominium as the owners who live in the condominium.

In order to have a valid meeting, there must be a quorum at the meeting.  Quorum simply means the number of owners that must be present in person or represented by proxy at the meeting.  For meetings of owners, this is usually 25%.  In some cases this threshold is varied by by-law so you should be sure to confirm this with legal counsel but for the purposes of this blog, we will assume quorum is 25%. If quorum is not achieved, the meeting is not valid and any actions taken at the meeting are of no force or effect.

Once you have obtained quorum, you may think that your problems are over.  Sadly, this is not the case.  The Condominium Act has another requirement that can cause significant headaches.  This is the requirement that all questions proposed for consideration of the owners at a meeting of owners must be determined by a majority of the votes cast by owners present at the meeting in person or by proxy.

What does this mean?  We think that the wording of the Act means, with respect to the election of the new board, that every director must be elected by a majority of the votes cast at the meeting.

For example, if we have 40 units in a condominium we need 10 unit owners represented in person or by proxies to achieve quorum.

Applying the requirement for a majority vote and assuming just 10 owners are present in person or by proxy, for a director to be elected in this example, he or she needs to obtain 6 votes.  That means at least 6 owners must be present in person or 6 proxies allow their proxy to vote for that person or there is some combination thereof.  If the proxies each name different candidates it may be difficult to get a majority of those present in person or by proxy to vote in favour of the same candidates.

As one can see, there are some fairly significant hurdles to getting the new board elected.  We think that simply putting directors in place by acclamation where the number of candidates equals the number of vacant positions may not be supported by the Act.  James Davidson has a good article on that point.

If a new board is not elected at the turnover meeting of a phased condominium this could affect the Declarant’s ability to register a subsequent phase of the condominium.

What is apparent is that all efforts must be made to encourage owners to attend meetings of owners.  Further, proxies must be solicited from those owners who will not attend and that there is consensus on the directors to be elected in order to achieve the majority vote.  Legal counsel can assist with this process.

We hope that in the proposed amendments to the Condominium Act the requirements for quorum at turnover meetings is relaxed and some of the issues with respect to voting are clarified so that lack of quorum and issues of majority voting even if there are only enough candidates to fill the vacant positions can be avoided because it’s important for the condominium board to be turned over to the unit owners as soon as possible.  The unit owners and not the Declarant should be managing the affairs of the condominium once a majority of the units are sold.

Development Charges Season

Post by: Craig Robson

Many municipalities in Ontario are currently undergoing a review of their development charges bylaws for 2014 implementation.

Anyone who is involved in real estate development should be paying careful attention to these reviews.

It is not unusual for a developer to determine that provisions in a development charges bylaw are not as favourable to that developer as they could or ought to have been.  For example, a few missing words in a definition within the bylaw can defeat a right to claim certain exemptions or credits.

Now is the time to be reviewing any definitions in a proposed development charges bylaw which may affect your development and to try to have those definitions “tweaked” as necessary to accommodate the developments you may be undertaking during the life of the bylaw (usually five years).

If nothing else, you should be keeping an eye on the proposed amounts of the development charges so that if the charges are increasing you can attempt to take out any requisite building permits to fix the amount of the charges at the old rates prior to the implementation of the new rates.

In addition, if there are any capital works which your proposed development may need in order to proceed, such as for example, a road or trunk sewer, a careful review of the background study relevant to the proposed bylaw should be undertaken.

You should attempt to ensure that all necessary capital works, to the extent any of them could be considered to be “growth related”, are:

  • shown as included in the capital works to be completed within the background study relating to the new bylaw; and,
  • that such capital works are scheduled to be completed within a timeframe which will accommodate your proposed development.

Otherwise, you could be faced with the prospect of having to either delay your development or, if the municipality will allow you to do so, pay the cost of the capital works without any guarantee of reimbursement.  Even if the municipality is inclined to reimburse you for the cost of any capital works that you undertake on its behalf, there may be difficulty in completing such arrangements if the proposed capital works are not contemplated by the background study that gives rise to the final development charge amounts in the bylaw.

Schedule G Part 3: Schedule G – Municipality

Post by: Craig Robson

With respect to phased condominiums, a “Schedule G- Municipality” is required for each phase with the exception of the final phase. The legislation does not specifically exempt the last phase from having a Schedule G – Municipality but the Registry Office has accepted that because this Schedule G is speaking about future phases it makes no sense to require the Schedule on the last phase of a phased condominium.

The Initial Registration of a phased condominium is not considered a “phase” and does not require a “Schedule G- Municipality”.  There is no explanation for this omission other than it was an oversight.

The drafters of the legislation seem to have had some lapses in this part of the Act.

Regardless of the legislation’s failure to require Schedule G – Municipality for the Initial Registration of a phased condominium, it is important to be aware that knowledgeable approval authorities require engineer certification for the Initial Registration as a condition of the registration (where the issue is perhaps most likely to arise) to address the same issues noted in a Schedule G – Municipality.

The purpose of the Schedule G – Municipality is to ensure that each phase being registered is “self-sufficient” with respect to services and street access if the balance of the phases in the project do not proceed.   The legislation wants to ensure the registered phases are not cut off from required street access and services if future phases do not proceed.

The following excerpt from O. Reg. 48/01, s. 52 addresses this need for a “Schedule G- Municipality”:

 (5) The material to be added to Schedule G to the declaration is,

(a) the certificates, with respect to the land included in the phase, that subsections 5 (8) and (9) and section 6 require; and

(b) a statement from any of the municipalities in which the land included in the phase is situated, or from the Minister of Municipal Affairs and Housing if the land is not situated in a municipality, that,

(i) all facilities and services have been installed or provided as the person making the statement determines are necessary to ensure the independent operation of the corporation if no subsequent phases are created, or

(ii) a bond or other security has been posted that is sufficient to ensure the independent operation of the corporation if no subsequent phases are created. O. Reg. 48/01, s. 52 (5).

(6) The statement described in clause (5) (b) shall be signed by a person authorized to bind the municipality or the Minister making the statement. O. Reg. 48/01, s. 52 (6).

(7) For the purposes of clause 146 (11) (a) of the Act, the facilities and services covered by the bond or the security mentioned in that clause have been installed or provided when there are no facilities and services remaining to be installed or provided that the person making the statement described in clause (5) (b) determines are necessary to ensure the independent operation of the corporation if no subsequent phases are created. O. Reg. 48/01, s. 52 (7).

In our opinion, the required facilities and services in 52(5)(b)(i) above should include the obvious pipes, wires etc. for electricity, telecommunications, sanitary and storm sewers, gas (if available) and water as well as access to a municipal street/road either directly through the common elements or by way of good and sufficient easements in favour of the condominium corporation.

The Schedule G – Municipality does not have a prescribed form.

A major issue with Schedule G – Municipality is that the Condominium Act does not obligate any municipality to sign the schedule which is a consistent issue and problem with the legislation in general.  Therefore a developer of a phased condominium could be stymied in its ability to complete the phases of a phased condominium if the municipality will not cooperate.  There would appear to be nothing the developer could do about this in the absence of a prior written commitment from the municipality to provide the Schedule G at the appropriate time.   This is a serious issue.

We have found most municipalities to be cooperative in providing the schedules when needed.   However, a usual and legitimate request that is made by municipalities before they will sign Schedule G – Municipality is to have the project engineer certify:

  • that the requisite services and facilities are in place; or,
  • the costs to install the same in support of a request to permit registration to proceed on the basis of a bond or letter of credit for incomplete services and facilities.

While the legislation does not specifically address this, it is not unreasonable for the municipality to require the project lawyer to provide his or her written opinion (based on and subject to the information received from the project engineer as to location and extent of services and facilities), that following the registration of the phase in question:

  • the required services and facilities needed by the phase (including access to a municipal street/road) will either be part of or through the common elements of the condominium plan; or,
  • by way of good and sufficient easements in favour of the condominium corporation.

Hopefully, the forthcoming amendments to the Condominium Act will obligate municipalities to provide required schedules such as Schedule G – Municipality provided proper certifications and opinions are provided to the municipality or provide for certifications from the project engineers and lawyer in lieu of the municipality signing the required schedule.