Dispute Resolution Recommendations

The effort to update our 12 year-old Condominium Act is foremost in many of our minds whether we are property managers or directors. 

One of the major themes throughout the public review of the existing Act has been the perceived power imbalance between the board and residents. Mediation, arbitration and the courts are currently the basic tools for resolving disputes in Ontario’s condominium communities.  However, these processes usually take a long time and legal costs accumulate quickly. Boards can usually call upon the corporation’s lawyer.  Residents have to hire their own, and for many owners, the expense is often prohibitive. An uneven playing field can be the result. Both boards and owners want a quicker and fairer way of resolving disputes. 

To that end, the Stage Two recommendations include the following.

• A new umbrella organization, to be known as the Condo Office, would be set up with four main functions: education and awareness; dispute settlement; licensing condo managers; and maintaining a condo registry. The Condo Office would operate at arm’s length from government, but with authority delegated by government. It would be funded by a combination of user fees and a modest levy (estimated at $1 to $3 a month) on each condo unit in the province. The Office’s dispute resolution efforts would involve the following.
• Provide Information: The Condo Office would act as a resource for owners, directors and managers to get quick, reliable, impartial, trusted and inexpensive (or free) information about the Condominium Act, interpretation of by-laws, and other important condo-related matters.
• Make Quick Decisions: The Condo Office would house a Quick Decision Maker who would be empowered to resolve disagreements by making quick, summary decisions on records, charge-backs, proxies, requisitions, and owners’ entitlement to vote.
• Resolve Disputes: The Condo Office would also take on more complex disputes through a second new and complementary mechanism, the Dispute Resolution Office, which would have the expertise and authority to provide a quick, neutral, inexpensive and informed assessment of a case. (The roles of Quick Decision Maker and Dispute Resolution Office could often be filled by the same person.)

There are no details on how the tribunal-like “Dispute Resolution Office” and “Quick Decision Makers” will work.  Is there a functioning model of either of them? The provincial Attorneys General of B.C., Alberta and Saskatchewan have had Dispute Resolution Offices since the late 1990’s. Whether these will provide a model remains to be seen. You can read more about B.C.’s model here.

PIPEDA – A real life scenario

Police arrive at your building and approach security.  They have a warrant for the arrest of a resident. The guard gives them access. The police go to the resident’s suite and knock on the door.  There is no answer and no evidence that the resident is home.  The police do not ask to enter the suite and do not do so.  In the days that follow, the situation repeats itself numerous times.  Frustrated, an officer leaves his card and asks security to inform them when the resident is home.  The security guard, believing he is doing his civic duty, calls the officer when he notices the resident arriving home. The police return to the building and arrest the resident.

Did the security guard do anything wrong? Were the resident’s privacy rights under PIPEDA violated? The answer to both questions is probably “YES.” 

Providing the police with access to the building was not the problem. Building staff should provide access to police when they present a correctly drafted warrant, or if a crime is being committed or is about to be committed (a 9-1-1 call). In this case, the police presented an arrest warrant which the guard read.  After verifying that the information regarding the owner was accurate, and after recording the officer’s badge number, the guard allowed the police to enter and approach the suite. The police did not ask to enter the suite.

The guard’s error was that he monitored the access guard reader and shared the information with a 3^rd party without proper authority.  Information about an individual’s whereabouts, as obtained through the swiping of a building access card, is likely to be considered to be personal information about the individual for the purposes of PIPEDA. Generally, the disclosure of personal information requires the individual’s knowledge and consent under PIPEDA. 

There are exceptions to this requirement.

Personal information may be disclosed by an organization without the knowledge and consent of the individual if the disclosure is:

• Made to a government institution which has requested the information and has identified its lawful authority to obtain the information and indicated that,
• The disclosure is for the purpose of enforcing a law of Canada or a province or carrying out an investigation; or,
• The disclosure is for the purpose of administrating any law of Canada or a province. 
• Made on the initiative of the organization to a government institution if there are reasonable grounds to believe that the information relates to the contravention of the laws of Canada or a province that has been, is being or is about to be committed.

It could be argued that one of these exceptions applies. After all, a police officer did request the information for the purposes of executing an arrest warrant. 

The police presented an arrest warrant.  The police did not present a search warrant forming part of an investigation. In the absence of a valid search warrant authorizing the collection of information, the guard should have asked for a written request for information. The request should be on police letterhead, it should identify the police officer and the person under investigation.  It should identify the specific information being requested and it should state that the information pertains to the enforcement of the law and that the officer has the lawful authority to collect it.

Yet, even with such a written request, the corporation could choose to wait for a proper warrant before providing information to the police.  There is no obligation to speak to the police without a warrant.  PIPEDA places us all in the awkward position of having to balance privacy concerns with the authority of the police to ensure safety and security.  Common sense can provide some guidance.  Is this case, there was no search warrant, no urgency to the arrest and no safety issue.  The guard should have waited for a proper search warrant or an official letter requesting information on the resident’s whereabouts before providing it. 

The Condo Game

On November 21, the CBC aired a television documentary called The Condo Game.  A summary of the facts presented in the program, as well as the full episode, can be found at CBC’s website.

The show and/or its guests highlighted several key points.

• There are now almost ¼ million condo units in Toronto and many experts think at least half are owned as investments.
• According to building science professor Ted Kesik, 1960s rental towers are more durable than many of today’s condos. The reason: developers realize their profit as soon as the building is finished and registered, so there’s little incentive to go beyond minimum building codes.
• The ability of Toronto to properly plan and direct development has been adversely affected by the OMB.

Seminars for Directors

The Condominium Act Review Stage Two report noted that “Board inexperience creates risks for condo communities. It can lead to poor decisions on repairs, investments or insurance coverage. It can also make directors vulnerable to more savvy managers, lawyers, contractors or even other directors who may try to take advantage of their inexperience.”

The report offered six recommendations affecting Directors and Officers including a recommendation for mandatory training for all new directors within the first six months of their term.  What form that training should take has not yet been articulated.  The Canadian Condominium Institute is currently the only body to offer directors’ training.

Brookfield believes that having well-informed directors benefits everyone.  We are investigating several options including offering the CCI curriculum in-house at more convenient times and locations than currently offered by CCI.  In addition, we are looking at options in addition to classroom-based training. An Online On Demand seminar series on such topics as understanding financial statements, effective board meetings, keeping proper minutes, use of committees… would allow directors to view short presentations/ videos on topics of interest to them, at their convenience.

We would appreciate and welcome your insights on the types of seminars and the topics we should offer.  Accordingly, we have developed a short, 10 question, 5 minute survey that we would like you to complete. Please click on the following link to go to the survey – https://www.surveymonkey.com/s/7CHK5V5.

Quotations on Governance

“No one ever teaches well who wants to teach, or governs well who wants to govern.” Plato

“Govern a great nation as you would cook a small fish. Do not overdo it.” Lao Tzu

“The rule for effective governance is simple… When there is a problem, you fix it. That is the job you have been sent to do and you cannot wait for someone else to do it for you.” Chris Christie

“A well balanced, inclusive approach, according to certain standards and ideals, is essential for the proper governance….” Laisenia Qarase