Policies

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.


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