Amendments to the Condominium Act, 1998: A Recap of 2017 to 2020
[caption id="attachment_9805" align="alignnone" width="1880"] Photo by Alexas Fotos on Pexels.com[/caption] As you may recall, on November 1, 2017, parts of the Protecting Condominium Owners Act, 2015 ("PCOA"), came into force. The PCOA amended the Condominium Act, 1998, and other legislation to protect owners and provide them with more information about their condominiums. Original estimates suggested that the remaining amendments from the PCOA would be rolled out in phases with the first phase as early as the Spring of 2018 and all amendments within a year or two. This did not happen. Most of the PCOA still has not come into force. Interestingly, there were over a dozen other minor amendments between November 1, 2017, and May 12, 2020. There were amendments to address electric vehicle charging stations. Amendments to move certain forms, such as proxies and the notice of meeting, to the Condominium Authority of Ontario. And, most recently, amendments to add temporary provisions related to virtual meetings and electronic voting because of the pandemic. But the rest of the PCOA still has not come into force. What remains, you might ask, to come into force? A LOT! This post will outline a few of the significant amendments that still have not come into force.
- Shared Facilities Agreements – it will be mandatory for condominiums to have shared facilities agreements where they share the use, maintenance, repair, operation, etc. of property, assets, or services.
- Procurement Process – the regulations will contain requirements for the procurement (i.e. tendering) process for contracts and transactions involving condominiums. We hope there is a minimum value (i.e. $1,000) or this could create a LOT more work for managers.
- Requisition Meeting – a new process for requisitioning meetings will shake things up. There will be a prescribed form for the requisition and a defined process, including a requisition by owners, a reply by the corporation, and a reply to the corporation’s reply. The owners will lose the right to call the meeting where the board fails to do so, but they will have the option of filing a claim with the Condominium Authority Tribunal or Superior Court of Justice (if the CAT is not hearing those types of disputes).
- Owner Occupied – the owner-occupied voting position will be renamed the “non-leased voting unit” position. It will only be required if a minority of the units are not leased. It must also be requested (within 15 days of the preliminary notice) by an owner eligible to vote for the position.
- Annual Budgets & Financial Statements – a new process for creating the budget and distributing it to the owners will be described in greater detail in the regulations. The audited financial statements will be changed as well.
- Indemnification by Owners – the amendments will only permit certain types of charges to be added to the common expenses for a unit. There will be a process for charging costs to owners, including a prescribed form for notifying them. The amendments describe the time periods for responses and the options available to the owners to dispute the charge.
- Repair & Maintenance – the repair and maintenance sections will change to include new definitions of “repair” and “maintenance”. The amendments also allow greater flexibility to share the costs of repairs and maintenance between owners and the corporation.
- Insurance – a standard unit will only be defined by by-law or as prescribed by the regulations. Gone will be the schedules provided by declarants on turnover. The amendments will also remove the ability to pass by-laws to extend the circumstances when insurance deductibles can be added to the common expenses for a unit. This will only be permitted in accordance with the regulations and only if added to the declaration.
- Additions, Alterations and Improvements – the process for making certain modifications to the common elements, assets or services (by a condominium) or to the common elements (by an owner) will change with the amendments. The terms used will change. The cost thresholds for triggering notice to the owners will increase, but the board must also consider if the owners would consider the proposed change to cause a material reduction in their use or enjoyment of the property.
- Nuisances – the Act and regulations will prohibit certain activities likely to cause a nuisance, annoyance, or disruption to others, such as noise. In January of 2020, the government was soliciting feedback from the industry on this issue, so these amendments might be on the horizon. It would be a good time given nuisance complaints have increased in recent months with more people at home because of the pandemic.
- Compliance Orders & Oppression – the amendments will restrict the ability of a condominium to seek an order for the removal of a person from the property unless certain conditions are met.
- Declarant Obligations – declarants will be responsible for making additional disclosures to potential purchasers and providing them with a condo guide created by the Ministry or the CAO (if delegated to it by the Ministry). The declarants will remain responsible for first-year budget deficiencies, but the method of calculating the deficiencies and the time for notifying them will change.
- Prohibitions on Decisions by Declarants – New sections will also prohibit declarants from requiring condominiums to purchase units or other property from the declarant unless a post-turn-over board decides to do so. A similar prohibition will exist concerning agreements or other documents purporting to limit a condominium’s rights against the declarant (i.e. waiver of warranties or the right to sue the declarant for deficiencies).
- Performance Audits & Reserve Fund Studies – the process for completing performance audits will change, including the time for completing them. Reserve fund studies will also be modified to cover all repair and maintenance obligations of the condominium, including to the units (i.e. parking units where maintenance and repair can be with the condominium).