Back to Basics: Compliance & Enforcement

This is the latest post in our Back to Basics series, which is designed to introduce key issues in condominiums. In this post we will briefly discuss the various options used by condominiums to obtain compliance from owners who are not following the rules. We will briefly explain the processes and when each option is typically used.

Self Help

Self help measures – taking actions to address it without professional assistance - are perhaps the most controversial enforcement measure. The controversy comes mostly from situations where a condominium acted improperly in using self help measures, leading to the condominium being penalized. Some lawyers will recommend that condominiums not engage in certain self help, like towing vehicles, while others will recommend it so long as certain steps are taken to protect the condominium from potential liabilities first.

It is important that the condominium find authority for the self help action before engaging in it. For example, before towing a vehicle from the property for parking in visitor parking spaces make sure you give reasonable notice of the violation to the vehicle owner. Do you have a rule that clearly states that vehicles may be ticketed and/or towed from the property?

Another commonly used self help measure is to complete work on behalf of an owner. If an owner fails to maintain or repair their unit or the common elements and they have an obligation to do so (check the declaration, by-laws, and rules) the condominium may be entitled to complete work on behalf of the owner. The costs incurred would typically be charged to the owner and collected with a lien against the unit. Again, reasonable notice to the owner is required before the condominium hires contractors to complete work on an owner’s unit.

Condominium Authority Tribunal (CAT)

The CAT is an online dispute resolution tribunal that offers a quicker and less costly alternative to most courts. The first step is for the applicant to file their application online with the CAT. Once the application is accepted by the CAT and served on the other parties, the second step is to participate in negotiations. The negotiation step gives the parties an opportunity to resolve it without the assistance of a third party. If negotiations fail, a mediator is appointed to assist the parties resolve their dispute. If mediation fails, an adjudicator is appointed to hear evidence and make a decision. A decision from the CAT is enforced in the same ways as orders from other courts or tribunals.

The CAT initially opened its doors on November 1, 2017, to hear condominium disputes. The CAT’s jurisdiction has been expanded to include disputes about record requests, pets or animals, vehicles and parking, storage, nuisances (e.g. noise, odour, light, vibrations, smoke, vapour, and other nuisances described in the declaration, by-laws, or rules of the condominium), and indemnification (i.e. chargebacks) related to the matters within its jurisdiction. The CAT now hears more condominium disputes than any of the other court or tribunal in Ontario. There are talks of expanding the jurisdiction again to include disputes about owners’ meetings, like the validity of proxies, voting, and notices of the meeting.

Mediation & Arbitration

Mediation is a process where a third party helps the parties resolve their dispute by discussing the issues and possible solutions. Most mediations are now held online using Zoom or Teams type platforms, but in-person meetings can be used in some circumstances. If the parties resolve their dispute a settlement agreement is typically prepared to document their settlement. If the parties are unable to resolve their dispute the parties would typically engage in arbitration next. Arbitration is a process where a third party hears evidence and submissions from the parties and renders a binding decision. An arbitration award is typically enforced in the same ways that an order from the courts or tribunals is enforced.

Prior to the creation of the CAT and the expansion of the CAT’s jurisdiction, mediation and arbitration was often used to resolve disputes in condominiums. While the CAT hears certain compliance matters now, mediation and arbitration is still required by the Act for the following disputes:

• By a condominium against the declarant for the first year budget deficit or other agreements between a condominium and its declarant;
• Between two or more condominiums about cost sharing agreements;
• Between a condominium and its management provider;
• Between a condominium and an owner about an agreement made under section 98 (indemnity or alteration agreements); and
• Between a condominium and an owner about the declaration, by-laws, and rules where the CAT does not have jurisdiction, such as the obligations to maintain and repair the property.

While the CAT now hears most disputes involving unit owners, mediations and arbitrations are still used frequently for disputes about cost sharing agreements (shared facilities or reciprocal agreements), the first year budget deficit with the declarant, and disputes with managers.

Liens & Collections

Condominiums have a variety of options when it comes to collecting common expense contributions from unit owners, but the most used option is the lien. The lien includes the common expenses outstanding as well as interest, reasonable expenses, and reasonable legal costs incurred in the attempted collection of the arrears. If a lien is not available or undesirable, the condominium has other options for collecting arrears from an owner. If the unit is leased by the owner, the condominium may be able to collect the rent from the tenant until the common expense arrears are paid in full. If all else fails, the condominium can use traditional means to collect arrears, such as collection agencies and court claims.

Courts & Tribunals

There are several courts and tribunals in Ontario that hear disputes condominiums may find themselves involved in. For example, a condominium could have a contractual dispute with one of its service providers that would ordinarily be resolved at the Small Claims Court or Superior Court of Justice, depending on the value of the claim. Other examples include construction defect claims, negligence claims, and slip and falls. These are all typically resolved at court. Lastly, the Act provides the Superior Court of Justice has the jurisdiction to hear certain legal matters:

• To address situations where someone is causing a condition or engaging in an activity that is likely to cause damage to the property or injury to persons;
• To enforce liens with a sale or foreclosure process;
• To have an inspector or administrator appointed; and
• To remedy conduct that is oppressive, unfairly prejudicial, or unfairly disregards someone.

On the tribunal side, a condominium could find itself at the Human Rights Tribunal of Ontario. It would typically involve a claim alleging discrimination on the basis of a disability, but occasionally the allegation is discrimination on the basis of other protected grounds, like race, age, gender, or family status.

As with most legal issues, you should speak with a lawyer about your specific situation before commencing any legal proceedings as there are consequences to choosing the wrong forum for resolution of the dispute.