Law Times

Page 8 November 2, 2015 • Law Times www.lawtimesnews.com Will new condo tribunal be effective? Some lawyers worry proposed authority will mean big bureaucracy BY YAMRI TADDESE Law Times s the Ontario gov- ernment puts for- ward proposed changes to the Condominium Act to create a new dispute tribunal, some lawyers say they're skepti- cal about how well the scheme will work. The government says a newly formed condominium author- ity will provide access to quicker, more accessible, and lower-cost resolution of disputes between condo corporations and owners. But Toronto real estate law- yer Bob Aaron says he's not buy- ing it. "When a government like this one uses words like 'quick, impartial, and inexpensive,' my skepticism alarms go off. If the Landlord and Tenant Board is any example, the condominium dispute office is going to be slow, backlogged, expensive, and bi- ased," says Aaron. "I have serious reservations that the bureaucracy that's needed to run the condo office will be effective to do what it's supposed to do," he adds. Part of the concern is wheth- er the fees levied on condos will suffice to effectively run the of- fice, says Aaron, who predicts it will face administrative prob- lems. "It could be $36 a year for each condominium in Ontario. That would put its budget at $10 [million] to $20 million. The Ontario Municipal Board runs at $7.6 million, and the Land- lord and Tenant Board budget is about $21.6 million. I think it's unrealistic that the condo office could run effectively and effi- ciently on that kind of budget, and basically the sky is the limit," he says. "I just can't see how the gov- ernment thinks it's going to have an impartial, quick, and inexpen- sive system when everything else points to its inability to do that. If you want to bring an application in Toronto for the Landlord and Tenant Board, how many weeks do you have to wait? I'm weary of the whole thing." Aaron is also not in favour of adding to the nine already-ex- isting administrative authorities in Ontario, such as the Electrical Safety Authority and the Travel Industry Council of Ontario. "And now we're going to have two more, two more giant bu- reaucracies," he says. The proposed law would create two new administrative authorities. While the condo authority would be responsible for administering condo owner education, dispute resolution, and a condo corporation regis- try, a separate licensing author- ity would administer licensing of condo managers. Aaron believes condo owners shouldn't have to foot the bill for the operation of the new office. "The fact that it's going to be a tax on condo owners to fund two more giant bureaucracies, I find scary," he says. "Our court system, although there are fees to access it, basi- cally the courts are paid out of the general revenues of the prov- ince. I don't see why this author- ity should be funded as a tax on condo owners. I think it should be paid for out of the general revenues," he adds. While the government says access to justice necessitates a condo dispute resolution tribu- nal, Aaron believes people who don't like the decisions of the condo office are going to end up in court regardless. The real winners, he says, will be condo lawyers. "I think it's going to be a bo- nanza for condo lawyers. There's going to be a whole new special- ity of lawyers who appear in front of the condo board. So it's going to be two tiers: those who have lawyers and those who don't, like the Small Claims Court." Real estate lawyer Joy Mathews says the proposed legislation is sparse on detail. Those details will come through regulations and rules the new authorities will set out, he says. "The specifics still need to be worked out. They're trying to do a lot at one time," he notes. Still, Mathews says he sees a potential for a "huge equalizing power" in the proposed legisla- tion when it comes to cost re- covery in condo disputes. Currently, condo corpora- tions that commence an appli- cation against owners in rela- tion to compliance with the act, bylaws, and rules can get the entirety of their legal fees back from them whenever they win a cost award. That provision is a powerful tool for condo corporations that can place a super lien on homes for non-payment of those costs by condo owners, according to Mathews. "The new proposed legisla- tion extends that power to the unit owner," says Mathews. "So now, a unit owner com- mences an application and if they receive one dollar or more [on costs], they can, just like the condo corps, get all the addi- tional legal fees . . . they incurred to bring the application and [re- cover] it from the condo corpo- ration. The change means some breathing room for unit owners once the legislation comes into effect. "That's where the huge equalizing power comes to play," says Mathews. Mathews says the licens- ing aspect of the proposed law is also a much-needed move as that area is rife with "kickbacks and fraud." "Anyone can be a property manager. A new board has no idea who this person is and you're trusting them with ev- erything in your condo, so the licensing requirement was a re- sponse from the government to try to put some standards," he says. "And I think out of every- thing that's going to come for- ward, that's probably . . . the big- gest focus of the government's focus. It's an important one," he adds. LT The Ontario government is proposing significant changes to the legislation governing condo- miniums. Photo: ValeStock / Shutterstock FOCUS ON Real Estate Law A 2015 BRITISH COLUMBIA LEGAL TELEPHONE DIRECTORY THIS IS YOUR LEGAL COMMUNITY. STAY CONNECTED. INCLUDES BRITISH COLUMBIA, NORTHWEST TERRITORIES, NUNAVUT AND YUKON. 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