It’s Official: Strata’s Must Follow Bylaw Enforcement Procedure to Collect Charge Backs Against Owners
Paul G. Mendes, Partner
Phone: 604-685-4894
Email: pgm@lmlaw.ca
Most stratas have a practice of imposing “chargebacks” for repair costs and insurance deductibles on owners who are deemed “responsible” for the damage or loss. What many strata corporations fail to do, however, is follow the procedure mandated under s. 135 of the Strata Property Act before imposing the chargeback on the owner.
The strata corporation’s right to claim a chargeback from an owner arises under s. 133 of the Strata Property Act. Section 133 states that a strata corporation may do “what is reasonably necessary to remedy a contravention of the bylaws,” including doing work on or to a strata lot, the common property, or common assets. The section further provides that the strata corporation may require an owner to pay the “reasonable costs of remedying the contravention.” We now know that the reasonable costs of remedying a contravention of the bylaws may include an award of reasonable legal costs: see The Owners, Strata Plan VIS 1437 v Abolins, 2018 BCSC 2422.
Section 133 of the Strata Property Act makes a “chargeback” a form of bylaw enforcement even if the strata does not specifically have a “chargeback” bylaw. Many strata’s, however, do have a chargeback type bylaw, and most stratas have an insurance deductible chargeback bylaw. Why is it then that so many strata’s failed to follow section 135 of the SPA before enforcing the bylaws and claiming the chargeback?
Section 135 of the strata property act states that a strata corporation must not “impose a fine”, require a person to pay the “costs of remedying a contravention”, or deny a person the use of a recreational facility unless the strata has received a complaint, given the owner particulars of the complaint in writing, and a reasonable opportunity to respond (including a hearing) if requested.
In Strata Plan NW 307 v. Desaulniers, there was a flood that originated in an owner’s unit. The strata obtained a court order authorizing it to hire contractors to repair the damage and to collect any from the owner any expenses not covered by insurance. Upon entering the unit, the strata found little evidence of flood damage in the suite but discovered the owner (in psychiatric care at the time) had done significant damage to her suite in a manner that posed a hazard to other owners.
After completing repairs to the suite, the strata applied for a declaration that it was entitled to judgment against the appellant under s. 133 in the amount of $12,217. The trial judge held that s. 133 of the Strata Property Act authorized the strata to repair the damages and awarded the strata $12,217.
The owner appealed to the BC Court of Appeal. The Court of Appeal allowed the appeal and set aside the judgement. The Court held that “the notice provisions in s. 135 of the Strata Property Act are not ambiguous.” A strata cannot recover the cost of remedying a from an owner without giving the owner notice in compliance with section 135.
Strata corporations should ensure that their demand letters for chargebacks include the same warning as a bylaw enforcement letter with a clear reference to the notice and hearing requirements set out in section 135.
WHAT WE DO: Lesperance Mendes represents strata corporations and owners in all aspects of bylaw enforcement. Our lawyers have successfully represented strata corporations and owners in the Provincial Court, the Supreme Court, and the Court of Appeal. We also have extensive experience advising and representing stratas and owners before the Civil Resolution Tribunal and the Human Rights Tribunal. To arrange a consultation on your bylaw enforcement matter contact Paul G Mendes, Partner at 604-685-4894 or email Paul at pgm@lmlaw.ca.
THIS ARTICLE IS NOT LEGAL ADVICE: This article provides general information and should not be relied on without independent legal advice.