CRT Roundup—repairs, chargebacks, parking stalls, and more

CRT Roundup—repairs, chargebacks, parking stalls, and more

September 1, 2017

BY Kevin Zakreski

This post is part of a monthly series summarizing the Civil Resolution Tribunal’s strata-property decisions. There have been 18 new decisions since the last post.

Repairs—water penetration—negligence and significant unfairness

In Capek v The Owners, Strata Plan VR1706, 2017 BCCRT 42, the applicant owner alleged that the strata corporation was negligent and significantly unfair to him in taking “8 months to repair a . . . leak affecting [his strata lot’s] bedroom and that it failed to address a second . . . water issue in the [strata lot’s] living room.” The applicant asked the tribunal to award him “reimbursement of 50% of his strata fees and damages for loss of use of 50%” of the use of the strata lot, both for this eight-month period, as well as punitive damages and reimbursement of tribunal filing fees.

The strata property “had a broader history of water ingress.” During the period in which water leaks affected the applicant’s strata lot, the strata property was “undergoing a $1.1 million building envelope remediation project.” “It is undisputed,” the tribunal noted, “that the strata’s ability to complete the overall repairs to the building was largely dictated by the owners’ collective financial capacity, bearing in mind the complex is predominantly owner-occupied with only 9 units.”

The applicant argued that the strata corporation’s actions amounted to negligence “because the strata failed to properly oversee the professionals” it hired to find the source of the water leak and to carry out repairs” and that “he strata acted significantly unfairly towards him, given the delay and the strata’s alleged failure to respond to his concerns that included an allegation that the professionals hired were in a conflict of interest”

The tribunal decision set out a lengthy and detailed narrative of the events. After reviewing this timeline, the tribunal asked itself, “So, was the strata negligent here? Did it fail to act reasonably in all of the circumstances? Did the strata fail to exercise oversight in letting the repairs take the length of time they did? The answer in all cases is no.”

Emphasizing that “[t]he strata is not an insurer,” the tribunal found that the strata corporation reasonably relied on professional advice and assistance and “did not act unreasonably in managing the timeline of repairs to the [strata lot’s] bedroom leak, even though that leak took 8 months to fix.” Further, the tribunal found that the strata corporation’s actions failed to meet the test for significant unfairness because “there was nothing further council could have done to effect the repairs sooner because as volunteers the council relied upon the retained experts. The strata says, and I agree, the applicant has not shown how the strata could have expedited the repairs, given their own experts had difficulty identifying the source of the problem.”

Finally, the tribunal, in view of its “mandate that includes being mindful of the ongoing relationship between parties,” ended its decision by pointing out “even if I had concluded the strata was negligent in its oversight or had failed to respond to the owner’s communications detailed above, there was nothing in the strata’s conduct” that would have called for an award of punitive damages.

Chargeback—insurance deductible (1)

In The Owners, Strata Plan VR 194 v MacKinnon, 2017 BCCRT 46, the applicant strata corporation asked for an order that the respondent owner reimburse the strata corporation “$5,502.31, comprised of $5,000 for the strata’s insurance deductible and $502.31 for emergency repairs.” The amounts were for “chargebacks [that] relate to damages caused by a burst pipe that followed the owner’s bathroom renovations in his strata lot.”

The tribunal began by noting that “[t]he crux of this dispute is whether the strata is entitled to the chargebacks against the owner under the SPA or its bylaws, $5000 of which is for an insurance deductible.”

After reviewing the caselaw on this issue and the strata corporation’s bylaws, the tribunal found that “the only bylaw by which the strata could chargeback the owner here is bylaw 4.4, which means the chargeback only applies if the owner was negligent in performing his bathroom renovations.” The tribunal concluded that the owner wasn’t negligent, for the following reasons:

First, the strata’s primary submission is essentially that having requested renovation approval, under the bylaws the owner bears the responsibility of any damages “as a result” of that renovation. The strata appears to assert the owner is responsible simply because the damage occurred following his renovation. It is significant that the strata does not assert the owner was negligent.

Second, the owner says there have been a total of 13 leaks in the common property piping, based on the historical evidence set out above, and that they only occurred because the common property piping was over 42 years old and were pitted and paper thin in areas, over their 20 to 25 year life span. The owner notes the strata’s deferral of the depreciation report, saying that that would document the need for piping replacement. The strata does not dispute the age of the piping or its expected life span.

In the result, the tribunal dismissed the applicant strata corporation’s claim.

Chargeback—insurance deductible (2)

Zhang v The Owners, Strata Plan BCS 1039, 2017 BCCRT 56, also involved a dispute over responsibility to pay an insurance deductible. The case started with a leak in the kitchen ceiling of a ground-floor strata lot. After extensive investigation, it was discovered that “the leak was caused by a drywall screw or nail penetrating the supply line to the bathroom located above the kitchen in unit 3.”

The strata corporation sought to chargeback to the owner of unit 3 $5000, representing the deductible on its insurance policy. The owner resisted, ultimately launching this claim before the tribunal. The nub of the dispute, as the tribunal put it, was:

The owner says the pipe is located within a dividing wall between units 2 and 3 and is therefore common property as defined under the SPA. Conversely, the strata says the pipe is not located within a dividing wall thus making it part of the owners strata lot and therefore the owner’s responsibility.

As the tribunal noted, “[s]ection 158 of the SPA addresses insurance deductibles.” After reviewing that section and a number of leading cases on it, the tribunal examined the strata corporation’s bylaws, observing that the governing bylaw “does not contain a negligence standard and simply holds the owner ‘responsible’ for the strata’s deductible if the damage originated from their strata lot.” This analysis of the authorities and the evidence led the tribunal to the following conclusions:

Considering my observations of what is shown in the photographs, I find that the section of leaking pipe that was replaced was the section that runs from the kitchen ceiling bulkhead to the upstairs bathroom vanity shut off and the section of pipe that leaked is within the wall cavity between units 2 and 3 as suggested by the owner. It is undisputed that the leaking pipe only serviced unit 3.

However, based on section 68(1) of the SPA, the boundary of the strata lot comprising unit 3 is the midpoint of the wall dividing unit 2 and unit 3. The section of wall where the pipe entered from the kitchen bulkhead below is the stud wall that forms the bathroom wall of unit 3 and is located past the midpoint of the dividing wall and within unit 3.  I find the pipe, although located within the dividing wall, is also located within the owner’s strata lot.

Applying the principles established in Morrison and given the strata’s bylaw 30(2) that holds the owner “responsible” for damage that originated in his strata lot, I find the strata is permitted to charge the insurance deductible to the owner’s strata lot.

Chargeback—insurance deductible (3)

Clark v The Owners, Strata Plan LMS 3938, 2017 BCCRT 62, concerned a dispute over responsibility to pay an insurance deductible:

The owner claims the strata is responsible to pay the strata’s $5,000 insurance deductible that resulted from a flood caused by the overflow of the owner’s washing machine. The owner asks the Civil Resolution Tribunal (tribunal) for orders that the owner is not responsible to pay the insurance deductible and the strata remove the $5,000 charge from the owner’s account. . . . In a counterclaim, the strata asks the tribunal for an order that the owner pay the $5,000 insurance deductible that resulted from the washing machine overflow.

The case turned on an interpretation of the governing bylaw. The tribunal found that it effectively adopted a negligence standard for such cases:

Read separately, I agree that bylaws 37(2) and (3) are unambiguous. However, ambiguity is created as the two bylaws set different standards or responsibility and both standards cannot apply. As stated by the parties, bylaw 37(3) does not set a negligence standard and is general in nature. Bylaw 37(2) clearly sets a negligence standard that explicitly applies to any expenses that are not covered by insurance. Further, bylaw 37(2) expressly says that in the event there is an insurance claim, the strata’s insurance deductible is the owner’s responsibility and will be charged to the owner. In my view, the only reasonable interpretation of bylaw 37(2) is that it applies to insurance deductibles. In adopting bylaw 37(2) the strata has deliberately turned its collective mind to insurance deductibles and adopted a negligence standard for the specific purpose of considering when an owner can be found responsible to pay a deductible. I find that bylaw 37(3) does not apply to an insurance deductible.

The tribunal concluded that the owner wasn’t negligent in the circumstances:

In order to find the owner negligent, I must find that they acted unreasonably in the circumstances or had some knowledge or reason to believe that the washer sensor would fail and did nothing to address it. I cannot find either. I accept the owner’s submission that they were in unit 113 when they used they washer on October 10, 2014 and there is no evidence they delayed in addressing the overflow situation upon becoming aware of it. Although they knew their washer was aging, there is no evidence before me that indicates the owner was, or should have been, aware the washer sensor would fail. The fact it was old does not mean it would imminently fail. I find that the owner was not negligent with respect to the washer’s failed sensor and they acted reasonably in the circumstances.

In the result, the tribunal ordered the strata corporation to remove the charge relating to the insurance deductible from the owner’s account and to reimburse the owner for tribunal fees.

Strata council—removal—unauthorized payment from CRF—significant unfairness

Lawrence v The Owners, Strata Plan VIS86, 2017 BCCRT 58, concerned a number of complaints regarding a strata council’s management of “an older 42-unit apartment style building for adults 50 years of age and older.” The strata corporation was “self-managed” and was going through a series of major repairs connected with its depreciation report.

A number of owners, including the applicant owner, had concerns about the management of these repair projects. Eventually, the applicant owner was elected to the strata council.

Shortly after the election, the strata council removed the applicant owner, citing authority to do so in a bylaw that it characterized as being “intended to allow council to remove a council member who continually disrupts the smooth working of elected council.”

The applicant owner applied to the tribunal, pointing to his removal, expenditure of funds from the contingency reserve fund, and other irregularities as breaches of the strata corporation’s bylaws and instances of significant unfairness contrary to section 164 of the Strata Property Act. He sought a number of remedies, including orders for his reinstatement on council, removal of other council members, and requiring the strata corporation to engage a strata manager.

The tribunal found that the strata council lacked the authority to remove a council member:

the bylaw relied upon by the strata council is headed “officers” and generally deals with council’s ability to elect its officers from amongst the council members and how the duties of a particular officer will be discharged in the event of absence or removal. Bylaw 16.3 is authority only for the council to remove a member from their position as an officer, and is not authority to remove a council member generally.

Council members are voted onto council by the owners, and can only be removed by the owners. The strata’s interpretation of bylaw 16.3 was unreasonable, and its decision to unilaterally remove the owner for the purpose of eliminating a dissenting opinion was improper and contrary to strata bylaws.

The tribunal also found had made unauthorized payments out of the contingency reserve fund:

The strata has not submitted any evidence to indicate that an emergency necessitated the strata’s actions, or that owners understood the expenditures they approved could be exceeded if deemed necessary by council. There is also no evidence that the strata council took steps to obtain the authorization of the owners to incur additional expenditures or with respect to allocating approved expenditures amongst the project elements, despite having time and opportunity to do so.

I find that the council’s decision to make expenditures for parking lot maintenance in the amount of $5,118.75 and replacement of light fixtures at a cost of $4,325.45, contravened both the SPA and the strata bylaws. I also find that the council’s decision to make expenditures on the renovation project in excess of $110,000 contravened both the SPA and the strata bylaws.

Finally, the tribunal found that the strata council improperly disregarded a request from the applicant owner to call a council meeting and failed to provide access to strata documents and records.

All in all, these findings led the tribunal to conclude that “the strata, through council, acted in a significantly unfair manner towards the owners generally, and the claimant owner in particular.”

The tribunal didn’t consider reinstating the applicant owner to council or removing other council members to be appropriate remedies in this case. The tribunal did find that ordering the strata corporation to engage a strata manager is an appropriate remedy:

The numerous past failures of the strata council to act in accordance with its bylaws and the SPA, without excuse and without recognizing the prejudice caused the owners, suggests that there is a substantial risk that it will continue to act in the same fashion and this places the strata owners at risk of further prejudice and loss. Having the assistance of a property manager to set up the orderly management and control of the owners’ funds going forward, to ensure free access of the owners (or any dissenting council member) to information and reasonable participation in authorizing the work to be done is necessary.

***

I also find that ordering the strata to hire a property manager is an appropriate remedy. To be clear: this remedy is necessitated by the actions of the strata, through its council, and the increased expense or inconvenience that hiring a property manager may cause is a result of the actions of the council members in 2015 and 2016. I make this comment given the antipathy expressed towards the owner by council members and certain owners, with a view to avoiding any further antagonism being directed towards the owner as a result of my decision.

Limited common property—parking stalls

Simpson v The Owners, Strata Plan VAS 2876, 2017 BCCRT 43, was a dispute over entitlement to a parking stall. The strata plan “designates parking stall 20 as limited common property for strata lot 4.” In the strata corporation’s view, the “limited common property designation does not accurately reflect the situation.” It argued that certain unregistered license agreements, which were put in place at the inception of the strata property by its owner-developer, determined entitlement to parking stall. Under such a license agreement, the applicant owners were entitled to use parking stall 13. The strata corporation advised the owners of this when they purchased their strata lot and provided them with a Form B consistent with the unregistered license.

The applicant owners asked the tribunal to make three orders:

First, an order that the strata recognize and confirm that strata lot 4 has the exclusive use of parking stall 20 as limited common property. Second, an order that persons other than the owners are prohibited from using parking stall 20. Three, that the strata provide a corrected Form B to the owners.

This gave rise to four issues:

• Is strata lot 4 subject to an unregistered license agreement that prohibits the owners from using parking stall 20 and requires the owners to use parking stall 13?
• Is the designation of limited common property parking as shown on the strata plan in error?
• Does the tribunal have the jurisdiction to direct the amendment of the strata plan to re-designate parking stalls as limited common property and common property?
• Must the strata issue a modified Form B for strata lot 4?

The bulk of the decision concerned the first issue. The tribunal began by noting that “[s]ection 75 of the Strata Property Act states that the designation of common property as limited common property by the owner developer when the strata plan is registered can only be removed by an amendment to the strata plan under section 257.” The latter section calls for such an amendment to be approved by a resolution passed by a unanimous vote, which had not occurred in this case. Further, even though the strata corporation “argued that licensing agreements were entered into by the developer, . . . no evidence [was] produced to indicate any such agreements were entered into by the owner developer.”

In a similar vein, on the second issue, the tribunal found “there has been no evidence presented that the strata plan designations of limited common property for the parking stalls have been made in error.”

In light of its conclusions on the first two issues, the tribunal decided “there is no need for me to determine whether the tribunal has the jurisdiction to direct that the strata plan be amended.”

Finally, on the last issue, the tribunal noted,

Section 59 of the Strata Property Act states the strata must give a person making a request an information certificate in the prescribed form. The prescribed form is the Form B. Among other things, the information on the Form B must include which parking stalls have been allocated to the strata lot and the manner in which they have been allocated.

The tribunal concluded that the strata corporation must provide a “Form B for strata lot 4 within two weeks of the time when an appeal expires and leave to appeal has not been sought or consented to,” which would reflect the tribunal’s conclusions on the parking-stall issues.

Parking stalls—significant unfairness

The applicant owner in Moore v The Owners, Strata Plan KAS 1878, 2017 BCCRT 51, asked the tribunal for “a different common property parking stall for her use and gives three different proposed methods for the strata to handle parking assignments.”

The respondent strata corporation was “comprised of 5, 8-storey apartment style buildings with a total of about 250 strata lots.” The strata corporation used the following method to allocate its common-property parking stalls:

Section 76 of the SPA says the strata may give an owner or tenant permission to exclusively use common property that is not designated as limited common property, for a period of not more than one year and such permission may be made subject to conditions. Section 76(3) specifically states the strata may renew the permission and on renewal may change the period or conditions. Correspondence from the strata’s property manager to the owner stated that the parking stalls were assigned yearly, in accordance with section 76 of the SPA. I accept that this is the basis for the strata’s assignment of the common property parking stalls for the exclusive use of the owners.

The owner argued that this method had resulted in her receiving a cramped, “unusable” parking stall. But the tribunal found the strata corporation’s method of allocation to be acceptable in the circumstances: “I cannot conclude the strata has acted improperly in its general approach to assignment of the common property parking stalls. In other words, because the parking stalls are common property, the strata is entitled to assign them at its discretion, subject to the SPA and its bylaws. The exception would be if the owner can establish the strata has acted significantly unfairly.”

The bulk of the decision considered the issue noted in the last sentence of this passage—whether the strata corporation had acted in a significantly unfair manner. Ultimately, the tribunal concluded that it had not:

In summary, the difficulty for the owner is that the parking stall assignments in place do not indicate that the strata has failed to act in the best interests of all owners. The strata’s submissions are undisputed that the owner’s parking complaints are rare for the strata and that the strata has historically worked to accommodate owners where possible. The strata’s effort to accommodate the owner, by offering her other unassigned stalls, is evidence of that point. I also accept that it would be too burdensome for the strata to maintain a regular exchange of parking stall assignments. In any event, I accept the strata’s submission that each of the proposed remedies by the owner would not be acceptable to the owners as a whole, and certainly not without a vote.

Limited common property—approval of alterations—strata council—conflict of interest

In The Owners, Strata Plan KAS 510 v Nicholson, 2017 BCCRT 48, the applicant strata corporation asked the tribunal for an order that the respondent owner “restore the deck of her strata lot 15 (SL15) to its original depth and length, at the owner’s expense.” The deck was limited common property and the strata corporation said that the owner altered it “without proper strata council authorization” and that the owner had “abused her position as a council member and was in a conflict of interest.” The owner denied these claims.

The tribunal considered the main issue before it in this case to be “should the owner be required, at her expense, to restore her deck to its original depth and length on the basis that the owner had acted in a conflict of interest and/or had not obtained the appropriate strata council permission to extend her deck?” A subsidiary issue was whether the strata corporation had made its application to the tribunal before the limitation period on its claim had expired.

The main issue turned on the tribunal’s extensive review of the facts. At the time the owner requested permission to alter the deck there were three strata-council members: the owner and two others. The owner requested permission by email to these two other council members. One replied to the request with an email that stated par22 “I do not see a problem.”

The tribunal examined this email exchange and decided, “[b]ased on the evidence before me, I cannot conclude that the owner failed to act in good faith as required under section 31 of the SPA. . . . Further, based on the email evidence before me together with the owner’s own evidence, I find the owner took no part in the extension approval. For the same reasons, I find the owner did not act in a conflict of interest.”

The tribunal also found that the strata corporation’s claim was barred by the Limitation Act . On this point, the tribunal made some comments of general interest for strata councils:

The limitation period is like a countdown clock. . . . [I]t is key for the strata to understand that the composition of the strata council, such as with “new” members, is not the trigger for the limitation period to start running. The trigger is not when the strata with its current council configuration actually started to investigate its own records as to whether approval was properly given. The receipt of a complaint is also not necessarily the trigger. The limitation period starts when the strata, however represented by varying council members over time, knew or ought to have known it had a claim against the owner for extending her deck without the strata’s proper approval. This is because the applicant strata is an ongoing entity that functions through a strata council, whose members change over time. The strata council is not the applicant. Rather, the strata council is only exercising the powers and performing the duties of the strata, as per sections 4 and 26 of the SPA.

Alteration to strata lot—approval—in-suite washer and dryer

In The Owners, Strata Plan VR 484 v Lawetz, 2017 BCCRT 59, the applicant strata corporation asked the tribunal for orders “to remove an in-suite washer and dryer (laundry)” from the respondent owner’s strata lot and to require “the owner to return the drywall and plumbing to an ‘appropriate condition’ and to pay $8,000 in accumulated fines related to the laundry.”

While the strata corporation didn’t have a bylaw prohibiting in-suite washers and dryers, it did have one requiring an owner to “obtain the written approval of the strata before making an alteration to a strata lot that involves wiring, plumbing, or piping.” The rationale for this bylaw was that the strata corporation’s existing piping would have difficulty supporting in-suite washers and dryers.

The tribunal found that the former owner of the strata lot installed the washer and dryer without approval and that the respondent owner knew this when he purchased the strata lot:

The strata rejected the former unit 204 owner’s request for laundry installation due to piping issues in the building. That former owner told the strata the laundry would be removed. I find it was clear to the owner that the strata did not authorize the laundry, based on the contract. There are also the November 2015 council meeting minutes that reference a unit with unauthorized laundry and that the strata had directed that the associated strata lot remove it. Based on the overall evidence, I find the owner knew the laundry installed [in] unit 204 was unauthorized and the strata expected the laundry to be removed at the time he bought unit 204.

As a result of these findings, the tribunal concluded that:

the owner must remove the laundry from unit 204, at his expense, and in doing so he must return the affected piping to an appropriate condition. Bearing in mind the tribunal’s mandate, I further order that the owner not re-install any washer or dryer in unit 204 without the strata’s prior written authorization, which is not to be unreasonably refused. As for the drywall, I order that the owner restore it to an appropriate condition, as that is what would have been in place prior to the installation of the unauthorized laundry. I further order that once the laundry is removed, the owner must notify the strata so that the strata can arrange for an inspection, in accordance with the SPA requirements for providing notice for inspections, to ensure the work was done properly and in compliance with any applicable building codes.

The tribunal also found that the owner’s conduct left him liable to pay fines:

I find the owner knew before he bought unit 204 that the strata considered the laundry unauthorized and that it wanted the laundry removed. The owner decided at his own peril to refuse to remove the laundry because he thought he could successfully argue that the bylaws did not prohibit laundry and because he was not the owner who installed it. Given the strata’s fines began in late June 2016, I find the strata began this tribunal proceeding within a reasonable timeframe. I accept that in these circumstances a $200 fine was reasonable, and I also accept that the ongoing presence of the laundry amounted to a continuing contravention that entitled the strata to add a $200 fine every 7 days. The owner had clear notice of the strata’s position before fining began, which followed a hearing. The fine’s $200 amount and its weekly frequency were not unfair to the owner in all of the circumstances.

But the tribunal wasn’t willing to order the owner pay the full $8000 in fines he had accumulated:

I am not prepared to order payment of $8,000 in fines. Once the tribunal proceeding was commenced, the issue of whether the owner’s laundry should be removed was a matter for the tribunal to decide. Thus, I find the strata is only entitled to payment of fines accumulated up to December 13, 2016 when the dispute notice was issued, which I find was $4,600. I order the owner to pay the strata $4,600 in fines relating to the unauthorized laundry.

Bylaw contravention—fine—smoking

In Mason v The Owners, Strata Plan BCS 4338, 2017 BCCRT 47, the applicant owner claimed “the strata assessed a $200 fine against the owner’s strata lot for alleged contravention of the strata’s no smoking bylaw without any proof that the owner violated the bylaw” and asked the tribunal “to order the strata to reverse the fine and obtain proof of no smoking bylaw contraventions before assessing future fines.”

After reviewing a detailed chronology of the dispute, the tribunal observed that:

The law is clear that the procedural requirements of section 135 insert link of the [Strata Property Act] must be followed before a fine is assessed. That is, a strata must not impose a fine for a contravention of a bylaw unless the strata has received a complaint, given the owner the particulars of the complaint in writing, and a reasonable opportunity to answer the complaint including a hearing if requested by the owner.

In this case, “the facts of this dispute do not show the procedural requirements of section 135 of the SPA were rectified as the fines were never reversed and, in my view, as discussed later, the owner was not provided with sufficient particulars of the complaint to permit a rational response.” The tribunal ordered the fine reversed.

The tribunal also considered the applicant’s request for an order that the strata corporation obtain proof of alleged violations of the no-smoking bylaw before assessing future fines. While the tribunal was unwilling to grant the requested order, it did (as alluded to earlier) consider the strata corporation’s obligation to provide particulars of an alleged bylaw violation to the owner.

In the context of this issue, the tribunal made the following comments on disclosure of correspondence:

The owner submits that they requested copies of the complaint letters in order to ascertain details of the complaint. The evidence shows this to be true. The strata says the complaint letters were not provided to the owner for privacy reasons. I find this to be contrary to section 36 of the SPA and the Personal information Protection Act (PIPA). Here, even though the owner’s request for documents was made after the fine was assessed, it is important for the strata to adhere to the law when it considers assessing future fines.

PIPA sets out how private organizations such as strata corporations can collect, use or disclose an individual’s personal information. Section 18(1)(o)  of PIPA states that an organization may disclosure personal information about an individual without the consent of that individual if the disclosure is required by law.

Section 36 of the SPA authorizes disclosure of records which may contain personal information if the record is one that the strata is required under section 35 of the SPA to maintain. Section 36 requires the strata to make records available and it cannot refuse access to a record (or redact parts of a record) when a request under section 36 is made, except in very limited circumstances (see also Privacy Guidelines for Strata Corporations and Strata Agents revised June 2015 at page 22, Office of the Information and Privacy Commissioner for British Columbia).

I order the strata to follow the requirements set out in section 36 of the SPA and disclose records it is required to keep and maintain under section 35 of the SPA even if the requested records contain personal information.

Authority to issue special levy

MacPherson v The Owners, Strata Plan LMS 2892, 2017 BCCRT 50, involved a dispute over a special levy used to effect repairs to a seawall. The applicant owner asked the tribunal for an order that the special levy was invalid due to lack of authority.

The seawall was part of a complex made up of three separate strata corporations. The strata plans for two of these strata corporations (the respondent in this case and another strata corporation) showed portions of the seawall as part of their respective common property.

In view of the common nature of the seawall, the strata corporations at some point decided to manage its repairs and maintenance collectively. As the tribunal noted:

a bylaw was registered, for each strata, purporting to establish a “Common Council” to administer repairs and maintenance issues only for areas of “total commonality” between the three stratas. Amalgamation of these three stratas into one has been discussed, but not implemented.

The special levy at issue in this case was passed by a “3/4 vote resolution” at a meeting of this common council. A vote on a similar resolution at a general meeting of the respondent strata corporation failed to pass.

The tribunal concluded that a special levy approved in this manner is invalid:

I find the common council was without the authority to issue the December 4, 2010 special levy. There is no evidence in this proceeding showing a valid special levy was assessed against the owner’s strata lot for the seawall repairs, and at least some portion of those repairs were in respect of a seawall located on the common property of a different strata, where he is not an owner. I find the special levy assessed in December 2010 was contrary to the SPA and therefore invalid.

Collections—strata fees—mistake

In Pamudja v The Owners, Strata Plan VR 35, 2017 BCCRT 60, the applicant owner claimed “damages from the strata arising from collections proceedings authorized and pursued against the owner by the strata.”

It was uncontested that the owner wasn’t in arrears of strata fees at the time the strata corporation authorized its strata manager and law firm to issue demands of the owner and pursue legal remedies. Upon being informed of their error, the strata manager promptly apologized.

The tribunal noted that “[t]he question that arises from this finding of breach of section 135 of the SPA is whether the owner is entitled to reimbursement of any costs flowing from the breach.” The tribunal found that the only compensable damage incurred by the owner related to legal fees. It ordered “within 14 days of the date of this decision, the strata reimburse the owner for legal fees in the amount of $571.20 and for tribunal fees paid in the amount of $225 for a total of $796.20.”

Refusal to resolve dispute on the basis that it is too complex

In Turenne v The Owners, Strata Plan NW1370, 2017 BCCRT 44, the underlying dispute concerned liability for the cost of repairs to a common-property deck. The applicant owners argued that the respondent strata corporation was responsible for any repairs to common property. The strata corporation relied on an agreement with the strata lots previous owners, which required them “to make all future owners of [the strata lot] responsible for the maintenance and repairs associated with the [strata lot’s] deck alterations.”

This decision was a summary decision on “the request of the respondent . . . that the tribunal refuse to resolve this dispute on the basis that it is too complex.” The strata corporation argued that it wished to add the former owners and the person hired to inspect the deck prior to the owners’ purchase of the strata lot as parties to the dispute, something that couldn’t be done in a tribunal proceeding.

The tribunal noted that section 11 of the Civil Resolution Tribunal Act gives it “discretion to refuse to resolve a claim within its jurisdiction.” “In particular,” the tribunal added, “the tribunal may refuse to resolve a claim if issues in the claim or dispute are too complex for the tribunal’s process or otherwise impractical for the tribunal to case manage or resolve.”

In this case, the tribunal decided to exercise that discretion to refuse to resolve the claim. It concluded that the strata corporation had “a valid argument” with respect to the addition of the former owners to the proceeding, as it was “an open question” whether the agreement they signed could be binding on the current owners.

Preliminary application for representation by a lawyer

In Booth v The Owners, Strata Plan NW2575, 2017 BCCRT 61, the tribunal considered a preliminary application that was described as follows:

The owners’ application for dispute resolution involves the authorization and maintenance of a sunroom. The strata has insurance defence coverage, which includes legal representation as an insurance benefit. The strata requests to use a lawyer provided under this insurance contract to represent it in the tribunal dispute.

The tribunal rejected the strata corporation’s request. In coming to this conclusion, the tribunal noted that it had placed “significant weight” on the following considerations:

• The owners do not agree to the representation. This is a factor set out in both the Act and the tribunal’s rules. The owners’ view is that allowing the strata to be represented by a lawyer would “tip the scales of justice against [them]. There is no fairness in that.”
• The owners are not represented. This is also a factor in both the Act and the tribunal’s rules. In this regard, I have also considered the owners’ undisputed submission that they cannot afford legal representation.
• There is nothing exceptionally unusual or complex about the subject-matter of the dispute. It is a common dispute type within the tribunal’s strata jurisdiction, conferred under the Act.

Preliminary jurisdictional issues—res judicata and limitations

In Wong v The Owners, Strata Plan LMS 2461, 2017 BCCRT 55, the tribunal was asked to “decide two preliminary jurisdictional issues”:

The first is whether one or both of the owner’s claims have already been judged and decided by the court. If they have, the tribunal may refuse to resolve those claims under section 11(1)(a) of the Civil Resolution Tribunal Act (Act). This legal concept is called res judicata . . . .

Second, I must decide whether one or both of the owner’s claims are statute-barred under the Limitation Act because they are out of time.

The underlying dispute between the applicant strata-lot owner and the respondent strata corporation concerned the deactivation of key fobs and access to strata corporation records. In this preliminary application, the strata corporation asked the tribunal to dismiss the owner’s claims because they were the subject of previous litigation in the BC Supreme Court and because they were brought after the two-limitation period had expired.

The tribunal rejected the first ground of the strata corporation’s argument as it concerned the key fobs, noting that different parties were involved in the supreme-court proceeding (the strata corporation wasn’t a party to it) and a different set of facts were at issue. But part of the owner’s claim for access to records was held to be res judicata.

The strata corporation was successful on the bulk of the second ground of its argument. The tribunal found that “the owner’s fob claim is statute-barred under the Limitation Act because it arose more than 2 years before the tribunal issued the Dispute Notice.” Much of the owner’s claim for access to records was dismissed for the same reason: “I find that any claim by the owner that the strata did not provide access to strata records prior to August 31, 2014 is dismissed. This order does not include any portion of the records claim involving the owner’s access to records after August 31, 2014.”

Withdrawal of application

Grand-Clement v The Owners, Strata Plan KAS2467, 2017 BCCRT 45, was a summary decision “about whether the owner’s dispute should be withdrawn or dismissed.”

The substantive dispute between the parties involved “allegations about access to strata documents, collusion between strata council members and the strata property manager, failure to respond to correspondence or hearing requests, accounting and expenditure irregularities, and other governance issues.” The applicant owner asked the tribunal to allow her to withdraw the dispute under rule 126 of the tribunal’s rules. The respondent strata corporation, seeking certainty and finality, asked the tribunal instead to dismiss the application.

As the tribunal noted:

The key difference between a withdrawal and a dismissal is that disputes which are withdrawn can be refiled with the tribunal at a later date, subject to the applicable limitation period. Disputes which are dismissed may not be refiled with the tribunal, or another tribunal or court.

The tribunal began its analysis by noting “[i]n exercising its discretion to permit an applicant to withdraw a dispute, the tribunal must balance the applicant’s interest in deciding whether and how to pursue a dispute with any prejudice to the respondent.” In general terms, the tribunal should favour granting a dismissal, and there was nothing in this case to displace this general approach:

the tribunal should generally grant an applicant’s withdrawal application. Forcing an unwilling applicant to pursue a dispute before the tribunal is problematic for two reasons. First, requiring an applicant to invest additional time, energy, and possibly money, to pursue a dispute they no longer want to resolve does not meet the tribunal’s statutory mandate to provide economical, informal, flexible, speedy and accessible dispute resolution services.

Second, given the adversarial nature of the adjudicative process, it will usually be inappropriate for the tribunal to take jurisdiction over a dispute against the wishes of the person who made the application for dispute resolution. This is because a fair hearing of the issues depends on motivated parties providing the tribunal with a full factual record and submissions. Where the applicant does not want to pursue their dispute, this can unbalance the tribunal’s fact finding and decision-making functions, and impair the fairness of the process.

The respondent failed to show that it would be prejudiced by this conclusion:

I find that any prejudice to the respondent in this case does not outweigh the applicant’s interest in deciding whether to pursue her dispute. In making this finding, I put weight on the following:

• The strata has not paid any CRT fees,
• At the time of the owner’s withdrawal request, the dispute was in the facilitation phase, and the parties had not yet submitted evidence or arguments as part of the tribunal decision process, and
• The financial aspect of the owner’s claim is $500, which is a relatively small amount.

Finally, in light of these findings, the tribunal denied the strata corporation’s request to dismiss the dispute.

Default orders—fines—smoking

In Clark v The Owners, Strata Plan BCS 2785, 2017 BCCRT 49, the applicant tenant sought default orders “for the repayment of 2 fines levied by the strata, which the tenant says were levied in error, plus reimbursement of tribunal fees. The tenant also asks for an order that the strata be required to communicate directly with him, rather than only with the strata lot owner (landlord).”

With regard to the fines, the tribunal concluded:

This is a debt claim in a default judgment application where liability is assumed. I am satisfied that the tenant paid the fines, indirectly through the landlord, and that neither he, nor his landlord, have been reimbursed despite the strata dismissing the fines. I therefore find the tenant is entitled to an order for $400, the amount claimed in the April 10, 2017 dispute notice.

The tribunal also granted the order relating to communication, noting

I therefore interpret section 135 [of the Strata Property Act] to mean that where an owner or tenant is alleged to have contravened the bylaws or rules, the person who is the subject of the allegation is entitled to the notice and hearing rights provided in section 135 of the SPA. My interpretation in this regard is supported by the fact that section 135(1)(f) specifically also requires the strata to give notice to a landlord and the owner, where a tenant is the subject of the alleged contravention. This provision would be unnecessary if the strata is not required to communicate with the tenant directly where the tenant is the subject of the alleged contravention.

I find that the strata is required to communicate directly with the tenant, as required by SPA section 130 and 135, with respect to alleged contraventions of the strata bylaws or rules, and that is my order. I note that the strata is also required to give notice to the landlord in such cases.

Default order—strata fees—fines—cost of replacement of property

In The Owners, Strata Plan VR 1192 v Watamanuik, 2017 BCCRT 52, the tribunal granted the applicant strata corporation default orders for the payment of “outstanding strata fees of $975.67, $1,600 in fines, and $3,130.48 related to the owner’s agreement to pay the cost of the strata’s replacement of windows and sliding doors.” As the tribunal noted, “generally, the tribunal will assume liability for a default claim. That is, it is assumed that the owner has acted in the way the strata says they has acted. As a result, I have not reviewed the merits of the strata’s claims for bylaw fines or unpaid strata fees, including the amounts or any potential limitation period issues.”