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Residental units turned into commercial units

Bootleggers have to sell their unit

York Condominium Corporation No. 82 v. Singh
Court File No.  CV-12-448324
Justice Robert Spence
Heard: February 20 to 22, 2013

A family that was selling alcohol and cigarettes out of their residential unit was ordered to sell their unit and are exiled from the condo community.

This is an interesting case as it shows the high costs of ignoring a court order, the duties of a corporation to enforce the Act, the Declaration, its bylaws and its rules and the amount of time and effort required to get the necessary evidence to win a court case.

The case
In February 2013, YCC # 82 was successful in getting a court judgment forcing the owners of Unit 149, 4645 Jane Street to vacate and sell their unit because they ignored an earlier court order to stop selling beer and cigarettes out of their residential unit.

Contempt of court
Justice Spence states: “A finding of contempt of court is a serious matter that is quasi-criminal in nature. It is “first and foremost a declaration that a party has acted in defiance of a court order”. This is a very serious matter as a person found in contempt of court can be jailed.

To be found in contempt, a three-pronged test is required:
the order that was breached must state clearly and unequivocally what should and should not be done.
the party who disobeys the order must do so deliberately and willfully.
the evidence must show contempt beyond a reasonable doubt.

The corporation’s security staff and hired private investigators monitored the activities of the people going in and out of Unit # 149 and backed this up with video and photographic evidence. The evidence showed that respondents were continuing to sell beer in defiance of the court order.

Violation of the Act
YCC # 82 also claimed that the unit owners were in breach of sections 117 & 134 of the Condominium Act and the corporation’s Declaration and Rules. The Declaration for YCC #82 states that the units are to be used as a residence for a single family and for no other purpose.

Since the Respondents bought the unit, there has been a continuous and steady stream of human traffic in and out of the unit and around the unit. Unit owners and others have stated that the respondents are selling alcohol.

The selling of alcohol by the Respondents and the consumption in public areas of alcohol apparently purchased in such sales are creating problems at YCC #82 and creating a situation of danger and an unsafe environment. There have been disorderly activities.  The police have attended at the unit on several occasions.

A security officer at the condo testified that there is continuous traffic in and around the Unit; many of the individuals do not live at YCC #82.  The selling of beer is creating an unsafe environment and it appears to be creating an environment where others think that they can now sell such things out of their units.  We are currently investigating Unit #337 where we understand beer is now being sold.

Evidence from the property management showed that the respondents ignored all requests to stop selling alcohol.

Corporation’s responsibilities
Justice Spence stated that YCC #82 is under a positive obligation to take all reasonable steps to enforce the Act and the Corporation’s Declaration, By-laws and Rules and that all Unit Owners and Occupants (among others) must comply with the Act, Declaration, By-Laws and Rules of the Corporation.

Justice Robert J. Spence also wrote that where it can be established that an owner’s misconduct is serious and persistent and where the impact on a small community has been exceptional and where the Respondent appears to be incorrigible or unmanageable, the Court may order a unit owner of a corporation to list and sell their unit.

Namita Singh, has been engaged in selling beer at YCC 82 since the Order of Justice Stinson of January 2011 and all three residents were found in contempt of court.

The three residents were also found to be in breach of Rule 28 of the Rules and Regulations of YCC #82 that require owners and occupants not to do anything that “will annoy or disturb or interfere in any way with other owners or other occupant or those having business with them”.

The following relief was granted in favour of the corporation:
Namita Singh was fined $10,000, payable within 30 days.
Nutan Singh and Narayan Sundar Singh each were fined $2,500.00, payable within 30 days.
Nutan Singh, Narayan Sundar Singh and Namita Singh are required to sell and vacate their unit within three months, are barred from YCC #82 and are barred from owning any units in YCC #82. They must also pay the corporation’s legal costs of $32,462.81.The total amount shall be payable within 90 days.

The respondents are required to pay a total of $47,462.81 plus their own legal costs. That is close to the listing value of the units for sale on MLS.

On top of that they had to have paid the corporation’s court fees from the first court case and they will now have to pay real estate fees, moving costs and their real estate lawyer fees. I have some doubt that the corporation will recover all their costs as the owners may declare bankruptcy. If they have a mortgage, the mortgagee will get nothing.