A POTPOURRI OF STRATA ISSUES
Rather
than write on a single topic for this installment of Legally Speaking, I
wanted to touch briefly on three recent cases which I think are important to
strata corporations and owners.
While
this particular issue doesn’t often arise it can become quite contentious when
it does. Usually it arises in the context of a request by an owner for
documents, the purpose of which is to build a case against the strata
corporation. Section 36(1) of the Strata Property Act provides that the
strata corporation must make available to an owner or people authorized by them
in writing for inspection and provide copies of all documents that the strata
corporation is required to keep pursuant to section 35. Not only does this
include minutes, budgets and financial records but also correspondence to and
from the strata corporation. Such documents can contain confidential
information about owners in the strata corporation. The question often arises
as to whether or not access to these documents can be restricted. The answer
would appear to be no.
It
is the writer’s opinion (although others may disagree) that the provisions of
the Personal Information Protection Act don’t apply to permit the strata
corporation to refuse to disclose the information because it is disclosure
authorized by law (ie. s.35 permits the owner access), which is an exception to
the general rule that one must have consent to disclose personal information.
(A strata corporation may, however, choose to err on the side of caution and
refuse to provide such documents and let a court decide the correctness of the
position).
Nor
does there appear to be a general rule of confidentiality outside of the Personal
Information Protection Act. This was one of the issues considered in a
recent case I was involved in; Campbell
v. The Owners LMS1461 (2004)(BCSC). In that case I argued, on
behalf of the strata corporation, that correspondence regarding fines was
confidential and could be withheld from those entitled to see documents under
s.35 of the Strata Property Act.
I relied on the bylaw of the strata corporation permitting in camera
or closed council meetings when bylaw violations were being considered. If one
can’t “hear all about it”, why should they be able to “read all about it”?
Although Mr. Campbell’s application to see the documents was dismissed because
he wasn’t an owner, Madam Justice Baker did comment on the access issue. She
stated that it was her view (although not binding) that there were no
restrictions on access to documents because s. 35 didn’t contain any such
restrictions. Anything written to or by the strata corporation is able to be
viewed by an owner.
In
another recent case, Wakefield v. The Owners, Strata Plan NW2080
(2004)(BCSC), I acted for an owner who rented a strata lot and was fined for
doing so. The strata corporation had two conflicting bylaws regarding rentals.
One allowed one rental (and this was the one that Mrs. Wakefield was aware of
at time of renting her strata lot). The other bylaw, passed in1990, prohibited
rentals altogether.
At
the time the no rental bylaw was passed, the Condominium Act was in
force and s.30(1) of that act (as interpreted by the courts) required at least
one strata lot to be permitted to be rented. However, the Strata Property
Act permits a bylaw completely prohibiting rentals to be passed. The
question before the court was whether or not the no rental bylaw was suddenly
made valid by the passage of the Strata Property Act. The court held
that it wasn’t. The no rental bylaw was invalid at the time it was passed and
was of no force and effect. Mrs. Wakefield was therefore entitled to rent her
strata lot, entitled to get the fines she paid back and entitled to costs.
Strata
corporations that have not updated their bylaws upon the Strata Property Act
coming into force beware!
Strata
corporations are often faced with the difficult task of having to collect
unpaid strata fees. When letters and liens don’t work, the question is what to
do next? The answer is foreclosing. Section 117 of the Strata Property Act permits the strata corporation to bring an
action in court for an order that the strata lot be sold to satisfy the
arrears. This is an extremely effective remedy. If the owner doesn’t pay, the
bank that holds their mortgage usually will. If not the strata lot will be sold
and the arrears paid. Legal fees are generally collected in full. (I have yet
to go to court to get an order for sale. Payment always gets made before the hearing
date is set). The strata corporation wins all around. It usually doesn’t have
to be out of pocket for legal costs and collects all its money. Since the
decision in Strata Plan VR1008 v. Oldaker (2004)(BCSC), this has
become even easier. In that case the court held that a 3/4 vote (which is
normally required to commence a court action) wasn’t required for foreclosure
actions under s.177. The council can simply make the decision and proceed to
instruct the strata corporation.
Strata
councils should not be permitting strata fees to go unpaid. There is no need
with such an easy option available.
Shawn M. Smith is an
associate lawyer with the law firm of Cleveland & Doan located in White
Rock and may be reached at 536-5002. This article is intended for information
purposes only and nothing contained in it should be viewed as the provision of
legal advice.