CONDOMINIUM LAW: Rules and by-laws you should know prior to purchasing.
Unit owners must comply with the specific rules and by-laws of the condominium corporation, otherwise the Corporation has the right to get a court order directing compliance and ordering payment of its legal costs. If a unit owner intends to rent his/her unit, it is vital that he/she include a clause requirig the tenant to comply with all the rules and by-laws of the condominium corporation. These rules should be strictly adhered to in order to avoid any issues with regards to enforcement and non-compliance.
Here are some types of rules related to the following commonly encountered situations:
- There should be no internal changes to the unit or changes to common areas without written consent from the management.
- The carpeting or de-carpeting of various types of floors to reduce sound transmission, or against hardwood floors may be restricted.
- Barbecuing on balconies and enclosing the balconies is prohibited.
- There should be no satellite dishes and antennae.
- No parking of commercial or recreational vehicles.
- The use of elevators for moving has sometimes restrictive hours so it requires reservation and/or security deposits. If the elevator or loading area will be used for your move in purchasing a condominium, the management office should be contacted as soon as possible to book for the moving date.
- The condominium units may be strictly for residential use and must not be used for office type businesses or commercial purposes.
- Pets are absolutely restricted in some cases.
- The chosen types and color of window coverings should be seen from the exterior of the building, and may be restricted in choice.
- There may be restrictions on planting and other uses of exterior patios.
- The unit owner is liable for damages on exterior doors, including garage and or added items such as central air, fireplace, etc. particularly in townhouses.
- No noise should be generated especially any musical instruments.
- There should only be short term rental restrictions and other tenancy requirements.
The condominium corporation must accomplish regular studies on its reserve funds to determine whether the fund or the amount of contributions from the owners is sufficient enough for the expected costs of major repairs and replacement of any important elements of the capital assets (ie. amenities, water boilers etc…) of the corporation. It will depend on the board of directors to ensure the availability of the reserve fund for this purpose. Eventually, this will result in an assessment of each owner’s contributions to cover the costs of replenishing a reserve fund that is not adequate for any repairs and replacements. In some cases if the reserve fund does not have ample cash, owners may hit a major, unforeseen and unexpected expense.
Voting rights and electing the members of the Board of Directors is merely based on the number of units in the building and not the number of owners. It is simply, the more units you have, the more votes you may acquire. The use of proxies is generally for particular meetings of the owners but is not always used for voting purposes. However, if the proxy is specified for election or removal of a director or directors, the proxy must state the name of the director or directors for that matter whether the vote is for or against the election or removal. The corporation must keep all proxies for 90 days following the meeting.
The new Condominium Act clarifies some of the rules regarding a wide range of possible issues, including any changes to the common elements, capital assets, or services that the corporation provides. Certain changes can be made without prior notice. Nevertheless, changes can be made with notice to the owners and a meeting must be held if there is a request for it and the owners of at least 15% of the units want one. If the change is substantial, the owners of at least two-thirds of the units must be in favor (a “super majority”).
To change the constating documents of the condominium corporation, the declaration, consent from all the unit owners and mortgagees (lenders) is required. However, most condominium corporations would have great difficulty in obtaining a 100% consent agreement. Hence, there are some changes in the declaration, such as the allocation of common expenses, that would only require the support of the owners of at least 90 % of the units. Changing the declaration for some other matters, such as allowing pets, will only require consent from at least 80% of the unit owners.
Many clients still ask if there are other ways to deal with a condominium dispute rather than going to court. Actually, the new Condominium Act requires a mandatory mediation and arbitration to resolve problems and disputes, however, if mediation fails, going to court is generally the only option.