Archive for the ‘Strata Information’ Category

Strata council can’t make a policy change to how notice is issued or received

Thursday, April 19th, 2018

Council can?t change policy

Tony Gioventu
The Province

Dear Tony:

Our strata council and strata manager have sent the following notice to owners advising that the only way we can give notice or request any items from the strata corporation is through the property manager.  The council claim they have made a policy change with the instruction of the strata manager that no one may deliver a notice to any council member, and any such notices would be deemed to be void.

We have read the strata act and cannot find where the strata council or property manager has the authority to change how notice is issued or how it is received.

As a result of this change, several owners have had their requests for hearings declined and have been denied access to information. To the owners this looks like a slick way of preventing access to our strata information.

Could you please clarify how notice can be issued?

Devon M. North Vancouver

Dear Devon:

No, neither the strata council or manager may make a policy change to how notice is issued or received. A notice, record or other document that is required or permitted under the Strata Property Act or Regulations must be given to the strata in one of the following methods:

  1. a) by leaving it with a council member
  2. b) by mailing it to the strata corporation at its most recent address filed in the Land Title Registry
  3. c) by faxing or emailing to the strata corporation to the contacts provided or to a council member if a fax or email has been provided for the purpose of receiving notice or by putting it through the mail slot or in the mail box used by the strata corporation for this purpose.  

When a strata management company is contracted, they are acting as an agent of your strata corporation, and they may also be a destination for giving notice if they have provided an address, fax or email address. The Act in this section does not permit strata corporations to change or amend the form of notice that is provided or received.  The strata corporation must inform the owners who the council members are, and the council members must receive notice if it is delivered to them.  It is then up to the council member to inform the other council members the details and purpose of the notice.

Strata council members need to be vigilant about the procedures of having received notice.  The best solution is one location for address, email and fax so the council and manager can closely monitor what requests and notice have been received; however, because notice can be served on any council member, they need to be educated to understand the requirements for processing the notice immediately as many notices have requests that are time sensitive and could adversely affect your strata corporation. 

For strata corporations with rental bylaw limitations, a request for a hardship exemption requires a written decision within two weeks if no hearing is requested, or within one week of a hearing, otherwise the exemption is automatically granted.   Requests for hearings require the hearing must be held within four weeks after the request and notice of a Civil Resolution or Court action requires a response within the prescribed time period otherwise judgements may be made without the strata corporation involvement.  Requests for documents must be filled within 14 days of the request, seven days for a request of bylaws and rules, and a Form F Payment Certificate and Form B Information Certificate must be provided within seven days.  

© 2018 Postmedia Network Inc.

Closely examine terms of pre-sale agreement

Thursday, April 12th, 2018

Tony Gioventu
The Province

Dear Tony:

I purchased a condo two years ago before it was constructed. At the time, the price was negotiated at $595,000 and we paid 10 per cent down as a deposit.

The property is now coming available for us to move in, but we have received a notice from the developer that there have been additional costs of construction and development and they are increasing the price by 20 per cent, so we will have to pay an additional $120,000 if we want to purchase the unit. If we don’t, they have offered to refund our deposit, including the interest earned for the two years.

We were told by the developer this was in our contract, but is this legal?

Jenny C.

Dear Jenny:

A pre-sales agreement is a contractual agreement where you, the buyer, agrees to complete a purchase agreement upon completion of the project. It is not an actual purchase of a unit, it is simply a contract where you have agreed to purchase the unit when it is complete.

Developers often use a pre-sale as a method of securing buyers to ensure the project is financially viable. While a pre-sale of a condo can be a great way of entering the market as an owner or investor, you must look closely at the terms and conditions of the agreements. As the buyer, you must be provided with a copy of the disclosure statement where the developer explains what they are selling and describes your right under the Real Estate Development Marketing Act (REDMA) to cancel a pre-sales contract within seven days of signing the agreement with no penalties.

It is critical that you read the agreement closely and understand the terms and conditions of the contract, along with what you are actually purchasing However, it is easy to understand how buyers become highly motivated to purchase when there is so much excitement and pressure around the pre-sales process.

Buyers have either been pre-qualified for advance purchases at a posh evening event or you have possibly lined up for hours hoping to have the opportunity to secure one of the units, and once you are in the sales centre, if you don’t purchase, someone else in the lineup likely will. The seven-day cooling off period ensures buyers have the opportunity to contact their lawyer and closely review the details of the agreement.

When you review the agreement, pay close attention to the dates of completion and if there are any penalties associated with the deadlines. This will help you plan for your possession dates and identify what happens if the developer misses the deadlines. 

If you pay a deposit, identify who will get the interest on the deposit. Look for additional costs or increases the developer may be permitted to charge for construction, inflation or development. If you have agreed to a possible increase of 25 per cent of the purchase then, yes, the developer is likely in a position to charge the greater amount.

Don’t forget to review what you have purchased. How many parking spaces are identified in the agreement? Did we secure a storage locker? Have we confirmed the finishing details in the unit? Everything should be in the pre-sales agreement. Remember this is a contract to purchase and you may change or negotiate conditions with the agreement of the developer at the time of purchase, and you still have a seven-day period of recession. 

Review the conditions of common expenses. If the projected development subjects your future strata to leases for elevators, parking lots, storage lockers, entry and security systems or use of shared facilities or air-space parcel agreements, those future costs can easily double or triple strata fees once you have taken ownership of your unit.

The disclosures and pre-sales agreements are sophisticated documents. You are about to commit to a purchase that will likely cost in excess of half a million dollars. Isn’t it worth a $1,000 dollars for legal review and the peace of mind of a sound purchase?

If there is a breach in the agreement or compliance with REDMA, act quickly to exercise your rights and seek legal advice. Delay may result in the loss of your rights or a significant weakening of any legal claim you may have.

© 2018 Postmedia Network Inc.

Stratas can’t ignore B.C. regulations

Thursday, April 5th, 2018

Act applies to stratas throughout B.C.

Tony Gioventu
The Province

Dear Tony:

We purchased a Victoria condo in December and thought we did all of the right things. We requested copies of three years of minutes, the strata bylaws, an information certificate, copy of the strata insurance, and we read all of the documents, including the depreciation report.

We have just been informed of an order for repairs to fourth-floor balconies that was not disclosed. There was nothing in the minutes and the court decision was not disclosed on the information certificate.

The seller, who was a council member, clearly knew and did not inform us. ‎There is now a notice for a special general meeting with each strata lot having to vote on a special levy that will cost us $7,800. Can we sue anyone to cover this cost? 

JP Pritchard

Dear JP:

Record-keeping and disclosure of information is a growing problem for strata corporations in B.C. Many owners and strata councils forget that most properties, from duplexes to the largest of strata corporations over 1,000 units, are covered by the same legislation, The Strata Property Act and Regulations. 

I recently assisted a strata corporation in a small interior city where the council and owners claimed the act only applied to strata corporations in the Lower Mainland. There are also many small strata corporations that claim they are “non-conforming” strata corporations and have never had meetings and have no records, so the law doesn’t apply to them. Not true, there is no such condition as regional exemptions or non-conforming strata corporations. The laws apply equally to every strata corporation in B.C.  

Strata corporations have obligations to the owners when it comes to court/dispute actions.

First, the strata corporation must inform the owners as soon as feasible if the strata corporation is being sued or responding to a claim in provincial court, B.C. Supreme Court, The Civil Resolution Tribunal, through arbitration or a claim through the Human Rights Tribunal.

Informing the owners is a written exercise that is easily accomplished by including the notice in the minutes of council meetings and making them available to owners. Any decisions against the strata corporation as a result of an action must be disclosed on any Form B Information Certificate request. 

There are numerous complaints where strata corporations are not disclosing orders or decisions that are issued by the Civil Resolution Tribunal and arbitration. These decisions or orders are no different than court decisions and must be disclosed.

As a buyer, you rely upon the information provided by the strata corporation before you make your decision. As a council member, the seller was aware of the decision as she participated in the arbitration and the strata corporation received a copy of the decision ordering the repairs so it had the same obligation to identify the decision in the strata documents.

When a strata corporation or a seller fails to disclosure information required by the act, affected parties are in a position to commence an action to recover their losses or costs against either or both parties. The real estate agent of the seller may also be exposed if they were aware of the order.

As an owner, you may consider an application to the Civil Resolution Tribunal to address the dispute with the strata corporation and a claim may be filed in the provincial court against the seller and their agent. If there is evidence of non-disclosure by the agent, a complaint may also be filed with the Real Estate Council of B.C.

Strata corporations, councils and strata managers must remember that any decisions against the strata corporation must be retained permanently and must be identified on any request of a Form B Information Certificate. Buyers may want to search the strata plan number through the court registry, the Civil Resolution Tribunal, the Human Rights Tribunal or by going to www.canlii.org, which is a national registry of decisions. While not all decisions (such as arbitrations) are necessarily registered, it is a public registry where you can download copies of the decisions.   

© 2018 Postmedia Network Inc.

Repair claims require strict oversight

Wednesday, March 28th, 2018

Don?t delay on maintenance

Tony Gioventu
Times Colonist

Dear Tony: I am a council member of a new highrise building in Metro Vancouver that was completed in 2017. In the fall, several owners in the penthouse units complained about water stains on their ceilings that have developed since they have moved in. The developer was contacted and, as far as we know, someone was sent to look at the roofing system and reported back that there was an overflowing drain. During recent rainfall, a number of new leaks have popped up and there is more evidence of water. The council president and property manager were satisfied with contacting the developer, but the majority of council are concerned we are not approaching this correctly.

Clearly it is a roofing and drainage problem and there might be greater problems than we realize. We still do not know if the original call out was a repair or what happened. What is our duty as a strata council?

Gord A.

Dear Gord:

The regulation of warranties in British Columbia falls under the Homeowner Protection Act, administered under the umbrella of B.C. Housing, Licensing and Consumer Services Branch. The owner-developer at the time the strata corporation is registered and occupied, must provide the owners with the warranty documents for their strata lots and the strata corporation with the warranty documents along with a maintenance manual that includes the names of all contractors and products and maintenance obligations. The warranty on the common property of the corporation begins on the earliest date of occupancy on completed sale of a strata lot.

It is important to document that date for future reference. Whenever the strata corporation has a defect that requires a claim, you must respond as soon as possible and mitigate damages. If a claim is filed, the warranty provider must to respond to the claim. They might require the owner developer execute the repairs or they might hire a separate contractor to perform the repairs. If you do not file a claim with the warranty provider, they have no record of the problem and a future problem on the same issue or relating to the defect might be frustrated by unreported failures and claims. For every claim, review the warranty and identify the method how a claim has to be filed. In most policies, the claim has to be in writing and filed to a prescribed address or contact.

You may still contact the developer; however, always copy the warranty provider. If the owner- developer or the warranty provider have conducted any repairs, they must provide the strata corporation with a written report on the repairs that were conducted. This will form part of your warranty records.

It is critical your strata council closely monitor and document all warranty claims and repairs. The warranty for your building has a value of $2.5 million and if properly administered will ensure your owners are not paying for needless repairs and you are properly managing your assets. A detailed independent warranty review at least a year before the five-year building envelope and 10 -year structural coverage is well worth the investment.

Both the strata council and the property manager have a fiduciary responsibility to act in the best interest of the strata corporation. If you willfully fail to follow the requirements set out in the warranty documents and miss deadlines or fail to file claims, owners in your strata have reasonable grounds to sue council members in the event of a loss. As there are no limits to the amount of claims, this could be a claim filed in the Civil Resolution Tribunal.

The obligations for council are simple. Gather all warranty documents. Maintain copies of all records and communications. File and copy all claims for building defects with the owner-developer and warranty provider, and document all repairs following a warranty claim.

Glacier Community Media © Copyright 2013-2018

Jolt of reality when dealing with EVs

Thursday, March 22nd, 2018

Strata Property Act amended to make fees for charging stations more straightforward

Tony Gioventu
The Province

Dear Tony:

We are a 118-unit strata in Vancouver with plenty of extra parking. We have four owners who are asking for the installation of charging stations so they may purchase electric vehicles.

Council would like to grant the permission, but the changes and upgrades to the electrical system require some significant changes and the owners voted against the upgrades at our annual meeting. The majority of owners have questioned why we are paying for the upgrade for only four people. A fair question, but if we can manage the upgrade, we could accommodate 12 stations and make them accessible to everyone.

We are getting conflicting information from the city, the manufacturer and our property manager as to how we can recover this cost. Are there simple steps we can implement? 

John K.

Dear John and all strata councils across B.C:

The past week has brought a number of changes to the regulations and programs for the purpose of installing charging stations and implementing user fees. 

First and most important, the Strata Property Act regulations were amended on March 7 to include user fees for services or costs of service that only apply to common property and common assets.  User fees may be determined in either a bylaw or rule that has first been ratified by the owners at a general meeting and can now include a fixed amount or an amount determined on a reasonable basis the user’s rate of consumption, the recovery of operating or maintenance costs by the strata corporation, the number of users and the duration of use. 

Simply put, a strata corporation could adopt a bylaw or rule that sets out a cost for electric-vehicle charging at a fixed rate per hour of charging, which would include both the reasonable cost of electricity and the cost of any upgrades or maintenance requirements of the strata corporation.  It is intended to be a user-pay system if the rates and use are adjusted correctly.

For those eager councils, this does not mean you can charge strata lots for more hot water because they have more occupants. 

The province has also launched a charging solutions and incentives program that will provide rebates towards the cost of electric-vehicle (EV) charging equipment and provide support services for planning and installing EV chargers. The application needs to be completed by the strata corporation if the installation and upgrades are part of the common property or common assets of the strata corporation; however, the additional funding to install charging stations is an excellent funding source for strata corporations considering the installation of charging stations. Go to https://pluginbc.ca/  and  select charging solutions and incentives.

Not all installations are simple. If your strata corporation has surplus common area parking that can easily accommodate charging stations and is close to electric service, the installation and cost may be easily accommodated, but many strata corporations have assigned parking by licences and limited common property and no surplus parking. This may require stations in dedicated parking only for those owners requiring charging.

That may require an alteration agreement where the owner takes responsibility for the cost of the station and installation and any other related costs. For the ease of strata corporations and car owners, the future will be much easier as local governments (as the City of Vancouver has recently done) adopt bylaws that require electrical services be available at parking spaces to facilitate the ease of installation and management.   

For more information and instruction on installing charging stations go to www.choa.bc.ca and download the bulletin EVCS Report.   

© 2018 Postmedia Network Inc.

Strata council obliged to give residents notice of expense issues as soon as possible

Thursday, March 15th, 2018

On budget deficits and deductibles

Tony Gioventu
The Province

Dear Tony:

Our strata has not replaced the plumbing, and with a number of common area leaks in the last two years, our deductible is at $100,000. With another pipe break in early January, the strata was faced with a $100,000 deductible for the claim that the property manager charged to our 2017 operating account, which ended Jan. 31. 

Our strata is a 105-unit highrise in east Vancouver. As an owner, we are being faced with a substantial increase in strata fees as part of our annual budget. There are already petitions going around to defeat the budget. 

Did we not have choices or alternatives to pay the deductible? We have looked at the council minutes for January and February, and there is no mention of the claim or the approval of the proposed budget. Who decides where an expense is made from the strata corporation’s funds?

Nicole M.

Dear Nicole: 

You have identified a perfect governance question. The Strata Property Act would deem this as an unapproved expenditure as it was not approved as part of your 2017 budget or contingency fund. As a result, the act gives the strata corporation the authority to expend this money from either the contingency reserve fund or operating fund.

This does not give the strata corporation the ability to simply dump all types of unapproved costs on the owners in the operating fund and force them into a deficit each year. 

You might follow the simple rule not to spend money that doesn’t exist. The act permits expenses from either fund and in the case of an insurance deductible, the act grants a rare provision for the council to approve a special levy without the need for a three-quarters vote resolution or special general meeting for an insurance deductible. 

At a properly convened council meeting, the strata council, by majority vote, approves the amount of the special levy, the date it is due and the amount each strata lots pays.

If you issue a special levy, those owners who have homeowner or landlord insurance may qualify to claim on their policy the deductible/special levy, which may be substantially less than the levy. This is also the rare occasion that an insurance deductible may form part of a lien against a strata lot because it was an authorized special levy.

The decision to charge this cost as an unauthorized expense to the operating fund is a majority decision of council. The decision must be included in the minutes and the owners must be informed of the expense as soon as feasible. Unfortunately, your owners were not informed until the notice package for the annual general meeting was sent out. 

While a strata corporation may delegate some of its authority through a strata-management agency agreement, there are still decisions the council needs to retain as it is obliged to give notice of those decisions to the owners. Major expenses, emergency expenses, bylaw enforcement decisions, unapproved expenses, insurance deductible allocations and the approval of the proposed annual budget are all council decisions. 

The complication of this decision to place the deductible in the 2017 budget put the strata corporation in deficit and the strata must pay back the deficit in the next fiscal year. If the owners defeat the budget at the AGM, the new council should seek advice on its options to cover the cost of the deductible before it holds a special general meeting within 30 days. It is always possible to reallocate an expense to correct an error or as instructed by the owners. 

© 2018 Postmedia Network Inc

Crucial to keep conflicts in the open

Wednesday, March 7th, 2018

Strata council members have an obligation to put the corporation?s best interests first

Tony Gioventu
Times Colonist

Dear Tony:

We have an awkward situation in our strata corporation and need your assistance.

The vice-president of our strata council has been co-ordinating contractors and suppliers on a three-year construction project to replace our balconies that is costing about $1.7 million.

Our contractor accidentally copied all our council on an email to confirm progress payments that included an invoice from our vice-president, who has been acting as a sub-consultant of the contractor for the project and has been paid $75,000 in fees to date, acting as the certified consultant on the project. We budgeted for engineering fees up to $100,000, through a defined company, but the council and owners are very hostile that he did not disclose he worked for the company or potential conflict.

We are concerned about the integrity of the project and who he is representing, the contractor or the strata corporation. How do we resolve this issue? We do not want to get trapped in an endless costly legal dispute. We have had some questionable business decisions by this person over the years, so would also like to place other strata councils on alert.

M.H. Strata Council

Dear council members:

Unfortunately, there are many strata corporations that have discovered unethical or fraudulent business transactions involving strata councils and strata management companies. Non-disclosure of remuneration, business relationships and financial transactions is a typical complaint. Whether it is major construction, insurance claims, wind up of strata corporations, costly service agreements or investment planning, the common denominator is money, which is the source of most strata disputes.

The Strata Property Act defines the standard of care of a council member, the conditions for disclosure of interest and their accountability to the strata corporation. Council members must act honestly and in good faith with the best interests of the strata corporation as their obligation.

With that, they are bound to exercise care, diligence and the skill of a reasonably prudent person in comparable conditions. Any council member who has a direct or indirect interest in a contract or transaction with the strata corporation, must disclose fully and promptly to the council the nature and extent of the interest, abstain from voting on the contract or transaction unless requested by council to provide information, and must leave the council meeting while the contract is discussed and voted on.

The relationship in this situation is between the consulting company and the contractor; however, the consultant was providing services to and on behalf of the contractor and the strata corporation, so there is a duty of care owed to the strata corporation and a duty to disclose the full nature of the interest and the remuneration. As both the council member, the consulting company and the contractor were aware of the relationship and no one disclosed this information to the strata corporation, there is a reasonable argument to cancel the contract and retain independent services to complete the project while the matter is being resolved.

The council member who has received the compensation has a serious issue. If challenged through the courts or the Civil Resolution Tribunal he may find that if the contract was unreasonable or unfair to the strata corporation they may set aside the contract, or if the council member has not acted honestly or in good faith, require the council member to compensate the strata corporation for a loss arising from the contract and require the strata council member to pay to the strata any profit the council member makes as a consequence of the contract.

There may also be representation concerns regarding permits and certification of the project. In addition to receiving a financial benefit, who was the council member acting for? We can’t service two masters. It rarely works, especially when significant amounts of money or liability are involved. It would be prudent to have your lawyer speak to both the contractor and the consulting company. If any harm has been done in the process, a complaint may be filed with the Association of Professional Engineers regarding the conduct of the consultant and failure to disclose the relationship.

It is also prudent to inform the owners of what has taken place, advise them of steps council is taking. A simple solution for strata corporations in any significant business transaction is before you approve a contract, ask council and the strata manager to declare if they are aware of any interests direct or indirect where either the council member or strata management agent or agency would receive a financial benefit or has a business interest and record this action and results in the minutes.

The issue is not whether the services were competent or of value to the strata corporation, there was no valid reason to withhold this relationship. Clearly the council member was profiting from the contract and did not want their strata corporation to know.

Glacier Community Media © Copyright 2013-2018

Strata corporation must turn over copies of requested documents

Thursday, March 1st, 2018

Only in select circumstances can managers withhold information

Tony Gioventu
The Province

Dear Tony:

I recently put in a request for some routine documents owners are permitted to have copies of.  Two of those documents included a copy of the air space parcel agreement and the strata management service agreement. 

We understood we could be charged 25 cents per copy and included a cheque for the total amount of the copies. Before the strata manager released the documents, they insisted we had to sign a confidentiality agreement. We were appalled by the agreement as it prevented us from talking to anyone about the content of the documents and that we could not disclose these documents to any other strata owner in our building.

The manager told us this was a normal practice and if we wanted the documents, we would have to sign. Something seems very fishy? Is this normal?

Geraldine J. Vancouver

Dear Geraldine:

You are correct. Something is fishy. While there may be some provisions in the legislation to manage some documents differently, there is no provision allowed in the Strata Property Act or Regulations that permits a strata corporation to withhold documents.

Under section 35 of the act, other than the payment of the documents, the strata management company cannot add any such conditions. The air space parcel agreement is a public document filed in the Land Title Registry and the strata management contract is a service contract under section 35 of the act. 

The strata corporation must provide copies of the documents within 14 days of receipt of the request and you may consent to either receiving them in a print or digital form for convenience. The demand for a confidentiality agreement is not a normal practice and you should notify your strata council and advise it immediately.

Only the strata council has the authority to determine if there are documents that contain personal or privileged information and whether the information needs to be managed or protected for the best interest of the strata corporation.

There are circumstances where a confidentiality or non-disclosure document may be required. In several recent strata corporation windup proceedings where a strata corporation is negotiating with a buyer to confirm the details of an offer to deliver to the owners to be considered, or where there is a legal proceeding underway that requires confidentiality, there is a reasonable argument that the strata council has to act in the best interest of the strata corporation and that means all owners and interest holders at time. 

This does not imply the strata corporation has the right to withhold information, but it may require the strata corporation to release and manage the information in a different manner. If this is the case, the strata corporation normally directs its legal representative to speak directly to the owner requesting the information to determine the best method to resolve the issue.

In those circumstances, non-disclosure or confidentiality agreements may be necessary to protect privileged or proprietary information. 

We know there are already some reasonable restrictions within the legislation to protect everyone’s interests. For example, if a strata corporation is suing an owner, that owner is not an eligible voter and is not entitled to be present at the portion of a general meeting where the vote to commence the lawsuit is being debated or voted on and no, they are not entitled to be aware of the discussions or documents generated from that vote.

If your strata corporation and strata manager are not cooperating, you may obtain on order for the documents by filing a claim through the Civil Resolution Tribunal of B.C. Go to http://www.civilresolutionbc.ca to start your claim. 

© 2018 Postmedia Network Inc.

Legal pot sparks bylaw issues

Thursday, February 22nd, 2018

Make sure you understand what can and cannot be enforced

Tony Gioventu
The Province

Dear Tony:

Our strata council is getting a lot of pressure from our owners to adopt a bylaw that prohibits the use of marijuana and growing of plants. Owners are concerned this is just going to make our property the local grower and the value of our properties is going to fall.

Several owners have already complained about the smell of marijuana in the building from several smokers. We had to eradicate a grow op back in 2004, costing our strata over $75,000 in damages that we never recovered. 

What our council is struggling with is how far can we go with our bylaws? Do the federal and provincial laws override our ability to control what happens in our building?

Denise M., Parksville

Dear Denise: 

Federal legislation determines what substance may be possessed and consumed, the quantity of what may be possessed by individuals and if permitted, how it is grown, managed, regulated and taxed.

Each province then has the jurisdiction to determine how the distribution will be managed, who will manage the distribution and the controls placed on distribution. We may also find there are local government bylaws that will set apart specific zoning or regulations for the facilities that will grow marijuana and how local businesses market and distribute the products. 

Strata corporations are essentially private property. You cannot prohibit anyone from consuming marijuana as it comes in many forms that pose no nuisance to the community; however, in most strata corporations, the main issue is smoking. 

Smoke is a serious nuisance in many multi-family buildings as the smoke often migrates to other strata lots or common property and may contaminate those areas. While each strata lot is within its own climate or space, multi-family buildings such as apartment, connected townhouse or highrise-style buildings are rarely airtight.

Any neighbouring smoking or consumption that requires some sort of combustion will migrate to other strata lots. Your strata corporation is permitted to adopt a bylaw that regulates nuisance, such as smoking or noise.

The Schedule of Standard Bylaws already has a nuisance bylaw that can be enforced and your strata may adopt a bylaw that simply prohibits smoking of any substance within strata lots and on any common property. Those bylaws will continue to be enforceable. 

Your strata corporation is not permitted to prohibit or restrict the use of substances or plants that fall under the classification of medical purposes. If an owner or occupant requires the medical use of marijuana, the strata corporation is permitted to request valid documentation to grant the exemption. This is both for the protection of the strata corporation and the related strata lot.

The nature of bylaws for strata corporations raises an ongoing question for strata councils to consider. Is your smoking or nuisance bylaw enforceable? Strata corporations and managers are constantly borrowing bylaws from each other and tweaking them to apply to their own needs, but the limitations or changes they are adding to make them acceptable to their owners often render them unenforceable.

Even with enforceable bylaws, strata councils are still failing to follow the basic steps of bylaw enforcement, resulting in long costly battles between owners and their neighbours.  Spring seminars and workshops are an excellent opportunity for your strata council to refresh its knowledge of bylaw enforcement and application. Go to www.choa.bc.ca for a scheduled session in your area of B.C.           

© 2018 Postmedia Network Inc.

Retroactive fees wrong way to pay the bills

Thursday, February 15th, 2018

Purchaser shouldn?t have to pay retroactive fees

Tony Gioventu
The Province

Dear Tony;

We just purchased a condo in Langley and within a week of becoming owners, we were sent an invoice from our property manager that we owed back strata fees for November and December.

These are the increases to the strata fees that were not approved until the AGM at the end of December 2017, and we only became the owners as of Jan. 5.

Our strata fiscal year runs from Nov. 1 to Oct. 31. While the amount is not significant, it is the principle of the claim and the penalties being imposed by the strata manager that has us irate. Is a strata allowed to back-charge retroactive fees from previous owners to new owners?

Carol and Dave J.

Dear Carol and Dave;

The simple answer to your question is no, there are no provisions for retroactive fees; however, this is a more complicated problem that requires understanding how the Strata Property Act, regulations and the bylaws of each strata corporation function.

Here are the basic accounting principles for a strata corporation.

Every strata must approve an annual budget for a fiscal year. They can approve this before the year end for the next year, or no later than two months after the fiscal year end.

To ensure a strata corporation does not run out of operating funds, owners continue to pay the previously approved strata fee until the next budget is approved.

When the budget is proposed in the notice package, the notice must also include the schedule of proposed strata fees for the fiscal year.

This is where the owners would be notified of how increases will be covered in the next fiscal year.

By approving either the budget or amended budget, the owners are consenting to the fee schedule.

If the budget is approved before the new fiscal year begins, the solution is simple: the new fees come into effect.

If it is approved after the fiscal-year end, then the balance of the fee increases has to be paid for the remainder of the year.

The strata must collect the amount approved in the budget for the fiscal year, as that is the legal requirement under the act — the total amount of the budget divided by the unit entitlement/total unit entitlement of each strata lot for the fiscal-year period.

If the strata approves $100,000 in operating funds and a $25,000 contingency for the 2018 fiscal year, they must collect it. If they do not and it results in a deficit, the strata must pay that deficit back to the budget in the next fiscal year.

Many strata corporations that approve their budgets after the fiscal-year end choose to calculate the balance of the increases over the next 10- or 11-month period so it has the least impact on the owners and sets a comparable fee for the next year’s period with the least increase.

But some also introduce an adjustment for the next payment and call it a retroactive fee, which is incorrect, as the fee was not approved for that period; it encompasses the full fiscal year.

This is where your bylaws come into effect.

Strata corporations have modified their bylaws on payment schedules and methods, and this affects the ability of the strata corporation to manage and collect fees.

This is especially vulnerable when a sale occurs during the budget-approval process.

In your strata, the bylaws require the provision of 12 post-dated cheques for the next fiscal year, but that would be impossible, as your strata does not approve its budget until the end of the two-month period after your fiscal-year end.

A close look at the notice package for the AGM should indicate what the strata had intended and approved for the payment schedule.

A recent Civil Resolution Tribunal decision involving strata plan NW2729 will hopefully open the dialogue on this issue and help strata corporations plan their budget approvals and bylaws and manage their increases in strata fees correctly.

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