The corporation’s law ﬁrm
corporation’s law firm does not work on behalf of the individual
owners. The condominium corporation is their client. The board of
directors represents the corporation so the board is the client.
Actually, if there is conflict among the board members, the law firm
works at the pleasure of the majority of
The board hires the law firm, pays the legal bills and it is the board
that gives the assigned lawyer directions.
The law firm draws up contracts, registers by-laws and changes to the
declaration and handles legal issues with the developer, contractors,
suppliers, the city and the owners.
The lawyer also registers a lien against units that are three months
late in their maintenance fees and will represent the corporation in
mediation, arbitration, small claims court and in Superior Court.
The lawyer will also advise the board on the provisions of the Act and
the corporation’s declaration, policies and by-laws. The lawyer will
also advise the board on election procedures and the collection and use
of proxies. Many boards have the corporation’s lawyer chair the AGMs.
The lawyer usually takes direction only from the president or the
manager and will not respond to questions or queries from owners or
minority board members.
Code of Conduct
Lawyers tend to focus on their billable hours and hence the Solicitors'
Code of Conduct—to act in the best interest of the client (the majority
of the directors) invariably trumps any wider ethical guidance.
Some lawyers have been accused of meddling in condo politics by
advising the incumbent board members on how to fend off challengers and
being biased against opposition candidates when they chair the AGMs.
This is one reason why whenever the majority of the incumbent board is
voted out of office, the new majority replaces the law firm.
board and an owner
If an owner violates a provision of the corporation’s declaration,
by-laws, policies or rules, the board must inform the owner of the
violation and insist on compliance.
The owner may foolishly ignore warning letters about noise complaints,
unacceptable pets, a satellite dish, parking violations or whatever. If
this happens, there is little the board can do but take legal action
against the owner and the condo’s lawyer will be instructed to send the
owner a letter.
The threat of legal action begins when the owner first gets a
letter from the corporation’s lawyer. The letter describes the
violations and it demands that the owner cease and desist. The letter
will contain a threat of further legal action if he or she fails to
Finally, the letter may demand that the owner pay the corporation $600
or more; the costs of preparing the letter. The letter then says that
if the owner fails to pay within 12 days or so, the corporation will
add the costs to the unit's common element fees and if the fees are not
paid, it will lien the unit and proceed to put it up on a power of
sale. The letter may say that this amount and any future costs will
include interest charges.
Only a judge can order an owner to pay the corporation’s legal costs,
however, the lawyer has stated what those costs may start at.
At this point, the owner would be wise to seek advice from a lawyer
experienced in condominium law.
The threat of legal action begins when the owner gets the first
letter from the corporation’s lawyer.
Section 134 (5) states:
a corporation obtains an award of damages or costs in an order made
against an owner or occupier of a unit, the damages or costs, together
with any additional actual costs to the corporation in obtaining the
order, shall be added to the common expenses for the unit and the
corporation may specify a time for payment by the owner of the unit.
Owners do not understand how serious it is and the legal costs
face when the board takes legal proceedings to address non-compliance
The losing side can pay thousands of dollars if the board and owner go
to mediation. It quickly rises if they go to arbitration and can run
into the tens of thousands if they go to superior court.
Judges have ruled—in some cases—that the unit owner has to pay the
corporation’s full expenses in obtaining the order of compliance. (Of
course, it works the other way around if the owner wins costs.) They
award corporations, who are enforcing the rules, full indemnity because
they do not think that the other innocent owners should be forced to
pay when one owner flouts the corporations rules.
In two Ontario court decisions where the boards wanted pets removed
from the property, one owner had to pay the board $19,000 in court
costs while a second had to pay $25,000. This is on top of their own
A lot may depend on the wording in the corporation’s declaration
by-laws. Your declaration and by-laws may state that any owner is bound
to indemnify the corporation for any loss occasioned by his or her
actions. Others are silent on this.
It can get rough if the corporation can recover its costs by
them onto common element fees. Unpaid fees can, under certain
conditions, allow the corporation to register a lien pursuant to
Section 85(1) of the Act for unpaid common expenses.
If the condo has a strongly-worded declaration and by-law
owner to fully indemnify the corporation from all costs which the
corporation may incur caused by an act or omission of the owner, or any
contravention by the owner with any provision contained in the
Condominium Act, the corporation’s declaration, by-laws and rules the
owner may be on the hook.
What if the
got it wrong?
As I stated above, the lawyer’s letter may demand that the owner
the corporation $600 or more; the costs of preparing the letter, and
that if the owner fails to pay within 12 days or so, the corporation
will proceed to lien the unit and have it put it up on a power of sale.
Almost all condo owners would agree with the board handling discipline
problems so quickly and firmly. They would also agree that misbehaving
residents should pay the costs of getting them to abide by the rules.
Section 134 (5) is in the Act to stop condominium corporations being
hit with a rash of expensive and frivolous lawsuits by disgruntled
owners. The idea is to prevent innocent owners from being burdened with
costs for feuds that they are not party to.
However, what if the board did not inform the owner that he was
violation of the condo rules and the lawyer's letter arrived straight
out of the blue? No verbal requests to cease and desist, no letters
from the manager or the board. Nothing. Is a $600 lawyer’s letter a
fair and honest way of giving first notice?
In one case where an owner was playing his stereo too loudly, the first
two letters sent to the owner by the manager were never delivered. They
sat at the security guards’ desk.
The lawyer can be used as a bullyboy. A vindictive board may use
expensive lawyer’s letter to harass a disgruntled owner. Most owners
violate one or more rules from time to time. What is ignored when done
by most owners, such as parking in front of the lobby while unloading
groceries, is completely unacceptable when done by someone the board
does not like. An expensive lawyer’s letter may be unfairly used to
teach the owner a lesson or discourage a potential political opponent.
What if the resident did not do what they are being accused of?
Sometimes the board receives incorrect information or makes assumptions
that are not factual. What does the owner do, since the costs climb
every time he writes a letter to the lawyer?
Accusations written by a lawyer are not necessarily true. The lawyer is
as an agent of the board and he acts upon what they told him. Sometimes
he has no way of knowing if what he has been told is accurate or fairly
states the facts. Sometimes he doesn't care.
Perhaps an owner cannot afford to defend himself in court against false
or inaccurate charges. Rough justice does not seem so sweet now does it?
On the basis of one letter? I am not sure. It depends on what
is accusing you of and what your declaration, by-laws, policies and
They can register a lien but whether it is legal or not is something
that a court may have to decide. This is when an owner needs advice
from a lawyer who is experienced in condominium law.
It is likely that they will add it to your condo fees and let it gather
interest. The amount will need to be paid by you to get clear title
when you decide to sell. You will not be able to be a director or be
able to vote at an owner’s meeting as long as you are in arrears.
Here is a posting that one condo director posted on a condo owner’s
want to know why lawyers are allowed to write BS letters to owners
stating "you are liable for $xxx.xx costs in recovery" when it's not
true. I am fed up with lawyers claiming "recovery" costs from
owners—then in a separate covering letter to the board, they warn the
corporation that "recovery" may not be possible in view of the Condo
Act and/or our declaration.
They try to get
money "back" for the Corporation—expenditure of money that the lawyer
created, not the owner, by claiming it is owed by the owner.
They even try to charge the owner for
writing the letter, when all that
is necessary is a letter from management (or a set of letters from
I do not understand how they think
that this is okay but this is a
standard practice. Apparently this unsubstantiated "claim" system is
very common in other aspects of business or in litigation, certainly
not just condos.
What is the legal "principle"
involved here that makes an
unsubstantiated threatening claim okay in the first place? Normally we
just tell our lawyers "no thanks" to the scary letter to the owner, but
we have received hilarious threatening letters from lawyers demanding
money when clearly none is owed (usually from shared facilities
lawyers). Can someone explain this?
The lawyer is letting the board know that he is bluffing and
judge may or may not make the owner pay up. It is gambling because it
is not a guaranteed win for the board.
Most owners will become badly frightened when they read the lawyer's
letter so they will pay up and snap into line. Many will move out.
However, if the board misjudges the owner and is dealing with one that
has spunk, they may lose in court and will have to cough up the legal
The cute thing is that the board has a couple of advantages. If an
owner looks for legal advice, most condo lawyers will tell the owner to
lawyer's letter, sell the unit and get out because going to court is
not worth the time, money and lost sleep that it will involve.
If the owner sues, the corporation can offer the owner a settlement and
a confidentiality clause will keep the other owners from learning the
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