The discussions that occur between the board and owners

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Amos Dalton
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1 The Condo Act What Works, What Needs Work Windows, Windows Everywhere, but Who Will Replace Them? Maintenance and Repair! By Armand G.R. Conant, BEng, LLB This article provides a case law update on the issue of responsibility for maintenance and repairs as it relates to window assembly replacement. The discussions that occur between the board and owners concerning who is responsible for a repair or a maintenance item are legendary and occur in every corporation at one time or another. Most are resolved relatively amicably but unfortunately some go to litigation. The confusion and misunderstandings are quite understandable, and in the writer s view stem from three primary sources: interpreting the Condominium Act, 1998 (the Act ); the corporation s documents (particularly the declaration and rules); and insufficient education of owners as to their responsibilities (and sometime also that of board members). The analysis of a problem usually goes as follows: 1. Is the item in question part of the unit (as defined in the declaration), the common elements or the exclusive use common elements for that unit? 2. Are we are dealing with a maintenance, repair or repair after damage; 3. Who is responsible for it (sections of the Act), i.e., has the declaration changed the responsibilities set out in sections 89 and 90; 4. Could the correction be considered as an addition, alteration or improvement of the common elements or a change in the assets of the corporation and thus trigger the notice or approval requirements of section 97? There are many court cases that have dealt with repair and maintenance. Some decisions have been controversial, but all show that it is a difficult issue. There are judges that have taken the fair and equitable approach based on the specific facts, while others have taken a more black and white legalistic approach. So if the courts struggle with this issue is it any wonder that owners and boards have difficulties. While the Act has thankfully corrected certain deficiencies that existed under the previous legislation, some still exist and the CCI/ACMO Legislative Committee, of which the writer is the chair, will be making recommendations to the government for improvements. One matter that seems to pop up every now and then is the replacement of old windows (the entire window assembly and not just the glass). Cases have arisen across Canada, such as the leaky windows case of Mackin v. Strata Plan 1374 (1998), 23 R.P.R. (3d) 106 and the replacement of windows in Wellington Condominium Corporation No. 7 v. Hughes (2005), 30 R.P.R. (4th) 142. In the Wellington case, Justice MacKenzie held that the owners were responsible for replacing windows (and exterior doors) for their units when they had worn out due to normal wear and tear because this fell within the definition of maintenance. This decision is controversial and may cause problems for the condominium industry. With this backdrop, I wish to discuss two other window replacement cases. These have also been discussed by James Davidson of the Ottawa law firm of Nelligan, OBrien Payne in the summer 2007 issue of ccireview. C M C o n d o m i n i u m M a n a g e r M a g a z i n e, W i n t e r

Photo: Rudolph Ens Photography The first case is the Manitoba decision of Briggs v. Winnipeg Condominium Corporation No. 30.

The Briggs case involved the replacement of all windows (and window assemblies) at a cost of $4,069,448 and paid for by a special assessment, which for the

Briggs objected and sought to have the decision reversed (and the board removed) on the basis that the replacement amounted to an alteration, addition or

The court considered several factors including: (a) the windows were almost 40 years old, which was twice as old as their expected lifespan; (b) the original

could not be brought up to current building standards and therefore, to do so the replacement windows were not identical to the originals.

The question for the court was whether or not this replacement constituted maintenance.

we are familiar (e.g., Boychuk v. ECC #92 [leaky roofs]; Dyer v. YCC #274 [caulking]; Re Ronita Properties Ltd. v. YCC #320 [leaking roofs] and YCC #59 v.

2 Photo: Rudolph Ens Photography The first case is the Manitoba decision of Briggs v. Winnipeg Condominium Corporation No. 30. The second is the Ontario case of York Condominium Corporation No. 359 v. Solmica Chemical International Inc. The Briggs case involved the replacement of all windows (and window assemblies) at a cost of $4,069,448 and paid for by a special assessment, which for the applicant, Briggs, was $39,822 payable over 3 1 /2 years. No vote of owners was obtained to approve the project. Briggs objected and sought to have the decision reversed (and the board removed) on the basis that the replacement amounted to an alteration, addition or improvement of the common elements and was substantial, and thus required the 2 /3 vote of owners. The court considered several factors including: (a) the windows were almost 40 years old, which was twice as old as their expected lifespan; (b) the original windows were essentially worn out, obsolete and no new parts could be obtained and thus repair work was extremely difficult; (c) windows leaked a lot and could not be brought up to current building standards and therefore, to do so the replacement windows were not identical to the originals. In this case there was no question of repairing the windows; rather they had to be replaced. The question for the court was whether or not this replacement constituted maintenance. The court then analyzed the definition of repair and maintenance, going as far back as an 1879 British decision, and then reviewing some of the cases of which we are familiar (e.g., Boychuk v. ECC #92 [leaky roofs]; Dyer v. YCC #274 [caulking]; Re Ronita Properties Ltd. v. YCC #320 [leaking roofs] and YCC #59 v. YCC Brown & Beattie Building Science Engineering Reserve Fund Studies Performance Audits Condition Assessments Specifications & Tendering Forensic Engineering Roof Consulting Construction Review Contract Administration Practical Approaches Sensible Results Newmarket Guelph (905) (519) Fax: Fax: (416) Millcreek Drive, Suite 418, Mississauga, ON L5N 3E7 (416) C M C o n d o m i n i u m M a n a g e r M a g a z i n e, W i n t e r

3 #87 [leaky roof over a swimming pool]). After his analysis Justice Jewers decided that repair and maintenance have to be construed in a broad manner and that the essential purpose of the proposed work fell within the definition of maintenance as that word was used in the Manitoba Condominium Act. The court then said, Broadly speaking, to maintain is to preserve and prevent a decline in the condition of a property. The only way to preserve and prevent a decline in the condition of the windows is to replace them. His Honour decided that even if Briggs windows were presently in satisfactory condition it was not reasonable to wait until they wear out, and therefore, replacement now was warranted. In order to comply with current building codes many of the physical aspects of the new windows were different from the originals. For these differences, and even improvements, the court held that they would fall within the definition of maintenance and not change, and thus no vote of owners was required. His Honour stated, These changes are all necessitated by the current Building Code and cannot be helped. If the aim of replacement of the windows is maintenance, as I have found that it is, the only way the maintenance can be achieved is to comply with the current Code and make these changes. The court further recognized that maintenance will almost always result in some kind of an improvement or betterment, but this does not necessarily take it out of the definition of maintenance. However, the court recognized that maintenance is not openended and could not go beyond curing a defect (e.g., you could not replace a leaky flat roof with a pitched roof). In the end the court did agree with Briggs that some of the changes were not merely a function of what was strictly required for the proper maintenance of the window system and thus a vote of owners was required. These unapproved changes included: installing tinted glass; Professional Condominium Management Built on Customer Service Experience the Difference 75 Rosedale Avenue West, Unit 6 Brampton, Ontario L6X 4H4 Contact Michael E. Le Page, President Telephone: x 222 Fax: michaellepage@mrcm.ca installing coloured panels; the windows were different in type, style and quality (e.g., number of panes reduced, awnings installed instead of sliding, etc.). However, the court determined that these changes were not substantial and thus only the lower notice/vote requirement was needed. I agree with James Davidson s comment in his article that given that the majority of the window s physical changes fell within maintenance then why did the court order that the entire contract be sent for owners approval and not just those improvement items. The answer could simply be that it was clear from the evidence that most of the owners agreed with the project and thus either the notice under section 97 would suffice or that if a vote was requisitioned that it clearly would pass. So the Briggs case shows us how one court arrived at a definition of maintenance and decided which items would come within the definition and those that would fall under C M C o n d o m i n i u m M a n a g e r M a g a z i n e, W i n t e r

dow systems with the originals and concluded that on the basis of the evidence before him the replacement work was a repair and maintenance of the common elements and not an addition, alteration or

4 dow systems with the originals and concluded that on the basis of the evidence before him the replacement work was a repair and maintenance of the common elements and not an addition, alteration or improvement. In addition, he held that the material used, while not identical to the original was reasonably close in quality and as such was not a change and thus no formal notice or vote of the owners was required. The Solmica case also gives some interesting guidance and comment on seeking leave to appeal an arbitration decision. This is important for everyone who proceeds to mandatory mediation and arbitration under the Act and is thinking of appealing. Solmica tried to argue that since the arbitration was by court order and not by agreement then the test for appeals under the Arbitration Act did not apply. This was important for Solmica because one can only seek leave to appeal on questions of law. In addition, even if it change. Although not binding law in Ontario it will nonetheless be of assistance to everyone dealing with this issue. The YCC #359 v. Solmica case raises several interesting issues. It is an appeal from an arbitration that was heard by the Honourable Sydney L. Robins under the Arbitration Act, 1991 (the Arbitration Act ). Here his Honour decided that the replacement of the windows and window frames by the corporation was a repair or maintenance issue and not an addition, alteration or improvement, and thus did not require approval of the owners. The Arbitrator also ordered that the owner and their tenant allow the corporation s contractor to enter the premises to install the new windows (they had been preventing access). YCC #359 consisted of 22 units and the windows were replaced in every unit except Solmica s. The project was paid for from the reserve fund, with no objection or dispute from any other owner. The Arbitrator compared the new winis a question of law, the court will only grant leave for an appeal if it is satisfied that: (a) the importance to the parties of the matters at stake justifies an appeal; and (b) determination of the question of law at issue will significantly affect the rights of the parties. Despite innovative arguments by Solmica, the court decided that neither criterion was satisfied. Of particular importance to the court was that every other owner supported the replacement, and all other windows had been completed and paid for. One can seek leave to appeal only on a question of law (not a question of fact or of mixed fact and law). On this point, the court stated: The decision of the Arbitrator in this case rests on a particular set of circumstances, that is, the replacement of windows in a particular condominium building, and whether that replacement constituted a repair or an alteration or improvement. The Arbitrator s determination is primarily fact-based. It is not a dis- 1 2 C M C o n d o m i n i u m M a n a g e r M a g a z i n e, W i n t e r

5 pute involving a general proposition that amounts to a principle of law. The court then decided that: (a) the Arbitrator s decision as to the quality of the replacement materials was purely a question of fact, or at most, one of mixed fact and law (Arbitrator applied the test in section 97(1) to his factual findings); (b) whether or not the replacement was a repair or an alteration was a question of mixed fact and law (Arbitrator made findings of fact with respect to the replacement and applied the legal definitions in section 97). The court ruled similarly on other issues not relevant to this article and refused to grant leave to appeal. Where does this get us and where do corporations go from here? At least we have some further guidance on this issue, although the Hughes case is still somewhat troubling and will hopefully be dealt with in a higher court. So as we go forward, corporations will still have to look at each situation and decide when a change is truly a change. After looking at the wording of your documents to determine who is responsible for the new window (still not clearly determined by the courts and thus good grist for the legal mill) then each case will be fact specific to determine if section 97 applies. If the decision is yes then the last step will be to determine if the change is substantial or not. The saga continues, but at least it is a bit clearer on some points. Armand Conant, BEng, LLB, DESS (Sorbonne), is head of the condominium department for the Toronto office of Maclaren, Corlett LLP and represents numerous condominium corporations in Toronto and the GTA. Armand is a member of the Board of CCI (Toronto) and a vicepresident. He is also chair of its Legislative Committee and a member of CCI National s Government Relations Committee. He has written articles for many publications and has lectured at many conferences and seminars. Armand also holds an engineering degree and is fluent in French. Coulter Building Consultants Ltd. Consulting Engineers & Building Scientists Your Multi-Unit Residential Engineering Specialists Building Condition Surveys Reserve Fund Studies Performance Audits Water Penetration Assessment Parking Garage & Balcony Condition Surveys ENGINEERING FROM A PRACTICAL PERSPECTIVE Building Envelope Engineering: Problem Evaluation Remedial Design Tendering/Bid Analysis Contract Administration Site Review Burlington, Hamilton, Oakville Toll-free C M C o n d o m i n i u m M a n a g e r M a g a z i n e, W i n t e r

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`çåçç=i~ï= [LEGAL ISSUES OF PARTICULAR INTEREST TO THE CONDOMINIUM COMMUNITY]= Volume 23, No. 4 Winter 2009 Pages 390 394 When is a Hot Tub Not a Gazebo? When is a hot tub not a gazebo? The answer -- according