Law Times

Law times • OctOber 17, 2011 Key decisions hint at W McGuinty's tricks and treats Inside ith Halloween ap- proaching, it's tempting to com- pare the re-elected government of Premier Dalton McGuinty to the walking dead and other ghouls we'll no doubt see in abundance over the next week or so. Th e parallels are eerie. Th is was a party all but dead and bur- ied last spring and yet here they are back in the driver's seat. You have to tip the hat to McGuinty for pulling off such a stunning resurrection, although there are many who would argue Conservative Leader Tim Hudak shot himself in the foot. Despite adding 12 seats, Hu- dak is coming under sharp criti- cism for the loss. Among Conser- vatives, the consensus is he didn't go hard enough to the right but instead preferred to mimic Mc- Guinty's platform. Ironically, he was also trying not to come off as a mini-Mike Harris, a fact that proves the ad- age that you'll never satisfy ev- eryone, especially Conservative party members. "A million Conservative voters stayed home," the Canadian Tax- payers Federation complained. "It's not hard to see why. In com- parison to Hudak, [Prime Minis- ter Stephen] Harper campaigned as a veritable fi scal hawk in the spring, vowing to balance the budget by 2014, a year sooner than previous promised. Hudak, in contrast, campaigned as Mc- Guinty Lite, vowing to continue spending record levels on health care and education, preserve Mc- Guinty's costly all-day kindergar- ten initiative, and run defi cits for the next seven years." Ouch. With friends like that, expect the Conservatives to po- larize within themselves as right- winger Randy Hillier starts to make noise in the months ahead, a scenario that may well play out with a leadership change. So far, Hudak has kept the dissent with- in the party sealed but he may not be able to contain it much longer. Th ere were signs of cracks already this year. McGuinty, too, will face a leadership review sooner rather than later. He squeaked in a vic- tory, but if his successor is going to have a shot at a future win, that person will need as much time at the helm as possible to create a strong brand to carry into the next election. NDP Leader Andrea Horwath ably rode Jack Layton's memory and parlayed it into seven extra seats. She's now riding shotgun with the knowledge that Mc- Guinty will have to curry favour with the NDP to keep the Tories at bay and prevent a non-confi - dence vote and yet another gen- eral election. Short of luring a couple of Conservative or NDP members to their side, an MPP resigning, being kicked out of caucus or sadly, dying in offi ce, the Liberals are indeed walking a fi ne line. With a "major minority," as Queen's Park By Ian Harvey McGuinty has dubbed his posi- tion, the big questions now re- volve around what actions will be necessary to keep Ontario from being buried under the weight of its own debt, which stood at about $244.7 billion as of June, and an annual budget defi cit of about $14 billon. Th e fact is, as the Canadian Taxpayers Federation noted this past summer, revenues are strong. Th ey're up $10.8 billion to more than $106.6 billion. While some of the defi cit stems from the much-needed stimulus spending aimed at countering the eff ects of the 2008 fi nancial meltdown, what's hurting more is the Liber- als' continued spending habits. How the next government is going to deal with spending was among the key issues not dis- cussed during the election. Look- ing forward, it's likely to be one of the things we can't stop talking about. Th at will also be the case for the tough issues around employ- ment, such as the archaic ap- prenticeship rules for the trades, and how we deal with health-care costs. It's clear, then, that the gov- ernment is facing some diffi cult decisions. Spin it how you like, but the mandate thrown to the Liberals is hardly resounding. Th e province is split between urban and rural ridings with the Tories ascendant outside of the cities. McGuinty is one seat shy of a majority with the Tories and the NDP holding 54 seats between them to his 53. Th e fi rst task will be to choose a Speaker. During the last session, Steve Peters held the diffi cult task of controlling the mayhem, but if MPPs choose another Liberal, it will further reduce the ranks on the govern- ment side of the house. Th is is important because the Speaker's role is an honourable one that stretches back deeply into British parliamentary tradition. Th e Speaker is loyal to the house. Th e members nominate the Speaker, who's elected by secret ballot and maintains an impartial role in making decisions on proce- dure as a judge might, cautioning MPPs for breaches of behavioural standards, and citing precedent if existing laws and guidelines don't cover the issue at hand. Th is next session, therefore, will be a wily game of cat and mouse and the selection of the Speaker and the upcoming throne speech will be our fi rst hints at the tricks and treats ahead. Ian Harvey has been a journalist for 34 years writing about a diverse range of issues including legal and political aff airs. His e-mail address is ianharvey@rogers.com. COMMENT PAGE 7 Get used to unfolding those condominium plans I t's hard to predict which cases will de- velop buzz among the real estate bar. Sometimes, these cases turn out to be much ado about nothing; other times, they trigger seismic paradigm shifts in the way we practise the law. Without exaggeration, the recent de- cision by Ontario Superior Court Justice Darla Wilson in Orr v. Metropolitan To- ronto Condominium Corp. No. 1056 (also known as Rainville) may be such a case. In Rainville, the plaintiff , Kelly Jean Rainville, purchased a built-out three- storey condominium town- house unit. Unbeknownst to her, the boundary limits of her condominium extended only to the top of the sec- ond fl oor as the third fl oor was built above the unit into common element space. It was unbeknownst to her, at least in part, because the solicitor she had retained to do the purchase didn't review with her the vertical plans of the condominium. Had they done so, it was argued that the ab- sence of a third fl oor would then have be- come evident. Th e case has become quite notorious, most notably because, depending on how lawyers conduct their practice, it seems to elevate the standard of care by at least one notch. As argued by the purchaser's law- yer qua defendant in the negligence suit, the standard of care of a reasonably pru- dent solicitor conducting a condominium purchase is to study the horizontal plans and then only to ascertain the unit's loca- tion and shape in relation to neighbouring units and common elements. As such, it was thought to be beyond the call of duty to then go and examine vertical cross-sec- tion plans of the condominium. Further- more, this was no fl y-by-night solicitor representing the purchaser. She hails from a national fi rm and is one of the fi nest practitioners I know. If this was the standard of care prior to Rainville, then the Rainville case certainly has changed it. Post-Rainville, it's now in- cumbent upon solicitors doing condomin- ium purchases to review with the client all of the available plans of the unit available at the land registry offi ce. So in the case of condominiums that have plans that show the vertical cross sections of the building, it's necessary to show them to the purchas- ers with suffi cient clarity so they can then identify whether the unit complies with all of them. In the Rainville case, at least one of the vertical plans implied that the third fl oor of the townhouse wasn't includ- ed in the unit. According to Wilson, had the purchaser seen that vertical plan, the problem would have been disclosed before closing. Th e case isn't limited just to vertical plans. Th e Rainville case is authority for the proposition that a solicitor must pres- ent and review with the purchaser client all of the available plans aff ecting the unit. For some reason in the Rainville case, there were multiple horizontal plans for the con- dominium at the land titles offi ce. Th e judge held that had the other horizontal plans been reviewed with the purchaser, DISCRIMINATION UPHELD To disallow a fully competent and very experienced judge from presiding on she would have been aware of the illegality of the third fl oor. Especially in the context of condomin- ium townhouses, it's rare to see more than one horizontal plan. But if there happen to be multiple horizontal plans, the Rain- ville case now makes it incumbent upon solicitors to review all of them with the purchaser client before closing. As an indictment of the ineffi ciency of our court system, the events giving rise to the alleged negligence took place quite a long time ago as the facts in this case date back to 1997. Th at said, little turns on the timing of the circumstances. Th e standard of care for a The Dirt By Jeffrey W. Lem resale condomini- um purchase hasn't changed that much since then, particularly in relation to the scope of plan review with the client. If it really was the practice to review only the horizontal plans in 1997, then it certainly still was the standard right up until the eve of Rainville. Expert testimony on Rainville's behalf on the standard of practice came from On- tario real estate maven Bob Aaron. Aaron's opinion, materially paraphrased, was that with facts like those in Rainville, it cur- rently is and always was necessary to review with purchaser clients all of the condomin- ium plans showing the unit they're buying, including any relevant vertical plans. Of course, it wasn't Aaron's expert opin- ion, nor is it a proper interpretation of the Rainville case, to suggest that a solicitor must now conduct any sort of onsite inspection of the condominium unit to ensure compli- ance with the available plans. Nobody is sug- gesting that. All that the Rainville case does is expand the number of plans that the solicitor has to review with the client. It remains in- cumbent upon the purchaser client to then realize and alert the solicitor to any discrep- ancies or inconsistencies. In most instances, this standard of care won't be much of an additional burden at all. However, depending on the complex- ity of the building and the degree of plan review that was part of your practice be- fore the Rainville decision, the time you must now spend with each individual pur- chaser may have increased signifi cantly. Th is comes at a time when it's already dif- fi cult enough to eke out much profi t from a condominium resale transaction. As with many good cases that cause a buzz in the real estate bar, both sides are ap- parently appealing the Rainville decision. Of course, the trial decision remains authorita- tive until overturned and there's no telling if or when the Court of Appeal will get to the matter. In the meantime, real estate lawyers everywhere should come out to hear a dis- cussion on the implications of this case at the upcoming Six-Minute Real Estate Lawyer conference in November. At the same time, they should get used to unfolding all of those condominium plans. Jeff rey W. Lem is a partner in the real estate group at Miller Th omson LLP. His e-mail address is jlem@millerthomson.com. Editorial Correspondence hearings because of age is pure and sim- ple a prejudice as equal to saying a person can't be a judge because of their race, religion or nationality. Comment on lawtimesnews.com by Joyce Miller about "Appeal court strikes blow to deputy judges." www.lawtimesnews.com

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