Condo Directors Held Personally Liable For Legal Costs

 
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The Condominium Act (the "Act") has several provisions (sections 85, 134(5) and 135(3)) which place the financial burden of obtaining compliance orders on those responsible for the non-compliance, thus relieving innocent owners of this financial burden. There are numerous reported cases where the costs of legal proceedings were enforced against individual non-compliant owners. In a recent case, Boily v. Carleton Condominium Corp. 145, the court was asked to decide whether innocent unit owners should have to bear the legal costs of proceedings in cases where there has been misconduct on the part of the board of directors.

The Boily case involved a dispute as to whether proposed modifications to the condominium courtyard constituted a "substantial change" to the common elements as contemplated by section 97 of the Act. The proposed redesign of the courtyard included the removal of significant vegetation, the addition of parking spaces, changes to the design, shape, size and configuration of the courtyard and the replacement of the podium's original red-brick with significantly different-looking limestone veneer cladding.

Rodrigue Escayola of our firm was retained by a group of owners who felt that the proposed work constituted a "substantial change" that required the approval of 66 2/3% of the owners. The board argued that the work constituted "maintenance" not requiring a vote by the owners.

The board refused to hold a special meeting of owners as requested.The group of owners eventually requisitioned a special meeting of owners pursuant to section 46, requesting (amongst other things) the question of the new courtyard configuration be put to a vote requiring approval of 66 2/3% of the owners.

The board refused to recognize the validity of the applicants' requisition for a special meeting, alleging that they had not met the 15% threshold required to requisition such a meeting. In support of their refusal to call a special owners' meeting, the board took the position that in the case of units that were jointly owned, the requisition needed to be signed by the majority of the joint owners of each unit. Moreover, the board refused to provide the group of owners with the list of registered owners, despite numerous requests. The owners had requested this list, on four occasions, in order to rectify any alleged deficiencies in their requisition.

The board then issued its own requisition for a special meeting of owners, which indicated that the board intended...

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