Policies are essentially written guidelines regarding how the board
will exercise discretion with respect to those matters over which the
board has decision-making powers. Normally, policies are principles or
guidelines adopted by an organization that make managing a condominium
corporation easier and more efficient.
These policies are not directly binding on the owners; they are binding
on the directors, officers, property manager, employees and staff of
the condominium corporation. Their purpose is aimed at internal
corporate governance; in other words, ensuring that the corporation’s
managers and staff follow certain criteria when doing work on behalf of
the corporation.
Good examples are policies that deal with privacy issues, health and
safety, human rights, workplace harassment, environmental protections,
work ethics, handling cheques and cash, payment of invoices and the
handling of corporation documents.
Policies
in place of rules
Some boards adopt policies that are indistinguishable from rules. When
the board creates, modifies or rescinds a rule, it has to vote on it
and then inform the owners in writing. The owners have the right to
petition for an owners’ meeting to amend or repeal the change the rule
before it goes into affect.
No such requirements are required for the creation or change of a
policy. Nothing says that the owners have to be made aware of any new
policies or changes to existing policies.
Can the board enforce policies as if they were rules? In a couple of
rulings, the courts have ruled yes.
The courts have also ruled that the question of whether something is to
be a rule or a policy is ultimately a political question to be
determined by the politicians at Queens Park. The legislation offers no
guidance on this.
Challenging
a policy
There are essentially only two ways in which a disgruntled unit owner
can challenge a policy:
a.
a legal challenge.
b.
the removal of the
majority of the directors from the board in the hope that the new board
may amend the policy.
Both options however offer highly uncertain outcomes and therefore are
not resorted to lightly by unit owners.
The legal challenge runs the risk that the court would not interfere
unless the board is found to have exercised is discretion unreasonably
or oppressively.
The second option requires the disgruntled owner to convince the owners
of a majority of the units in the corporation to vote in favour of
removing the directors and even if they are removed, there is no
guarantee that the new board would amend the policy to the disgruntled
unit owner's liking.