Condominiums, or (i.e. condos), are becoming increasingly popular around the world, but particularly in Canada. With limited space in the downtown core of our major cities, developers are building upwards rather than outwards. However, condos are uniquely treated in real estate law and can be tricky to deal with from a legal perspective. This week, we look at what a condominium is, the law governing condos, and provide a brief overview of disputes.
What is a Condominium?
Condos are a type of property ownership. They are different from other property ownership in that it is shared. When you buy a condo, you get two things: ownership of a unit and shared ownership of the common property. The unit is the space where people live or rent out to tenants. The common property includes things like pools, elevators, fitness centres, lobbies, and so on. Units are maintained by the owners using their own funds, whereas common property is maintained through condo fees that each owner pays to the condo corporation.
The condo corporation comes into existence when a condo development is registered with the government. The corporation is composed of all of those who own a unit in the development. The owners elect a board of directors (also known as the condo board), who manage the corporation. Condo board members are all volunteers but have very important responsibilities, including enforcing bylaws, resolving disputes, maintaining common property, and preparing financial documents.
Condominium law in Alberta is governed by the Condominium Property Act. This Act outlines the requirements for developers in terms of the condo plan, the boundaries of the condo units, the appointment of an interim board, the sale of units, and the documents required. The Act further outlines the powers and duties of the condo corporation, the rental of units, damage to the building, and offences and penalties including administrative penalties.
In 2014, the Alberta government passed a bill to amend the current Act. The bill is designed to better protect owners. The biggest change is that it will establish a condominium dispute tribunal. This will make dispute resolution much more affordable and efficient, as the current forum is the courts, which is expensive and can be dragged out for many years.
Who are the parties involved in Condominium Litigation?
There are many different parties that can be involved in a dispute, it all depends on what the dispute is and when it arises.
If you are a buyer, disputes may arise between you and the following parties:
- The developer;
- The real estate agent you are using;
- Your lawyer;
- The company you have hired to review all the condominium documentation; or
- Your home inspector.
If you are an owner, you can have disputes with the following parties:
- Your neighbours;
- The condo board;
- The property manager;
- The developer;
- The real estate agent; or
- Your lawyer.
If the party is a condo board of directors, then disputes may arise with:
- Condo owners;
- Tenants;
- Developers;
- The property manager;
- Third party contractors or service providers (like electricity or cable); or
- Other board members.
In addition to the above, there is the possibility for disputes between multiple parties. Many of these disputes can be resolved without going to court. The question is, what is the current dispute resolution process for parties of a condo corporation?
How are disputes resolved?
While disputes can arise at all stages of the life of a condominium, there is no single dispute resolution process in place. Depending on the parties involved, there may be a dispute resolution process they must adhere to. For example, a condo board may have, as part of their bylaws, a clause that states that any dispute between neighbours must go through the condo board before litigation is an option. Or developers may have a contract with the condo board and buyers that stipulates that any dispute must be settled through mediation.
If a dispute relates to the Condominium Property Act, its regulations, or the bylaws of the condo board, or if a party has engaged in improper conduct, then an application to the Court of Queen’s Bench can be made. As mentioned earlier, there will be a different forum once the amendments to the Act are put in force this year.
Disputes between a tenant and owner would go through the Landlord Tenant Board of Alberta. A dispute between neighbours can be dealt with by conversation, a letter, or by involving the property manager or condo board. If the dispute is due to a delay in construction, or related to construction, can be dealt with in court, or through an alternative dispute resolution process that has already been agreed upon. It is clear that the resolution of disputes in condominium law varies substantially from issue to issue.
Regardless of the matters in dispute, condominium law can be difficult to navigate, and having an experienced lawyer can relieve the stress of dealing with the dispute. At HMC Lawyers, we have the knowledge and the experience to address any and all matters in the complex condo industry. If you have a dispute, contact us today to speak with a member of our Advocacy Team and get strategic and trustworthy advice. Call 1-800-480-3534 or contact us online. We represent clients in Calgary, the province of Alberta, and across Western Canada.