The Owners, Strata Plan VIS114 v. John Doe, 2015 BCSC 13
By Lisa Frey, Associate: admin@lmlaw.ca, 604-685-5438
In late 2013, a new tool was added to the tool belt of strata councils seeking to achieve important repairs. Section 173(2) of the Strata Property Act, SBC 1998, c 43, came into force which allowed a strata corporation to apply to the court to approve special repair expenses which receive greater than 50% approval but fail to reach the required 75% approval.
It was not until the case of VIS114 v John Doe, 2015 BCSC 13, that the court articulated the test that would be applied when strata attempt to use this provision. The statute provides as follows:
173(2) If […] a resolution is proposed to approve a special levy to raise money for the maintenance or repair of common property or common assets that are necessary to ensure safety or to prevent significant loss or damage, whether physical or otherwise […]
and the resolution achieves at least 50% of the votes, the Court can impose it on all owners as if it had achieved the necessary 75% approval.
In this case, a building envelope report was received in 2007 finding that over $5 million of repairs and maintenance would have to be made. The entire strata council who proposed resolutions to move forward with preliminary work on the project was subsequently ousted at the next AGM, and there became a 7-year “fractious battle” between the group of owners who wanted to move ahead with these expensive repairs and the group who did not.
The court clarified that it was not necessary under s. 173 for the repairs to be immediately required for a strata corporation to access relief. It was enough that the loss or damage was “significant” (for example the drop in BC Assessment value of one of the units over 3 years was $140,000), and that the repairs were necessary. Furthermore, so-called “band-aid” solutions were not accepted as a viable alternative.
In this case, the levy imposed was approximately $36,000 per owner. Even as far as special levies go, that is a steep one. The Court acknowledged the unfortunate fact that some owners would have to borrow, liquidate capital, or even sell their units to pay for the repairs. But, no one owner’s “personal situation” should dictate the result.
This case also underscores the importance of proper CRF contributions and planning for the future.
Finally, on a heartwarming note, Ms. Tausig, an owner of a unit who was not affected by the current water ingress, stated altruistically (and wisely):
I hope that the owners on the west side of the building who are experiencing similar problems to those we used to have will soon be able to have their side of the building restored. While such repairs are expensive and disruptive, I believe they benefit the entire building in terms of comfort, health, and marketability of unit.
The Court recognized her message as an expression of the prevailing philosophy under the Strata Property Act: “we are all in this together”, and imposed the special levy accordingly.
WHAT WE DO: Lesperance Mendes advises and represents strata corporations and owners in British Columbia on all aspects of condominium governance, including court applications for needed repairs. For more information about our strata law practice, or to make an appointment with one of our experienced strata lawyers, please contact Paul G. Mendes, Partner, at pgm@lmlaw.ca or 604-685-4894.
Lesperance Mendes Lawyers
900 Howe St #550, Vancouver, BC V6Z 2M4
(604) 685-3567