CondoVoice - Spring 2008

www.ccitoronto.org

VOL. 12, NO. 3 • SPRING 2008

P U B L I C AT I O N O F T H E C A N A D I A N C O N D O M I N I U M I N S T I T U T E - T O R O N T O & A R E A C H A P T E R P U B L I C AT I O N D E L’ I N S T I T U T C A N A D I E N D E S C O N D O M I N I U M S - C H A P I T R E D E T O R O N T O E T R É G I O N

Toronto Balconies Bloom Plus: ■

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Condo Financing Options for an Environmental Retrofit Condominium Insurance -

Prudent Seniors Dictate ■

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PM #40047005

Asbestos - What You Need to Know Management Agreements - A Different Wrinkle Amalgamation It’s Time to Future Proof Your Building Five Steps to a Better Roof Installation Vacant Land Condos - Not Necessarily Vacant After All The Description - Lost in the Shuffle?

… and more

Contents Canadian Condominium Institute / Institut canadien des condominiums Toronto & Area Chapter 2175 Sheppard Ave. E., Suite 310 Toronto, Ontario M2J 1W8 Tel.: (416) 491-6216 Fax: (416) 491-1670 E-mail: cci.toronto@taylorenterprises.com Website: www.ccitoronto.org

2007/2008 Board of Directors PRESIDENT John Warren, C.A. (Co-chair, Conference Committee, CAI Liaison) Adams & Miles LLP

VICE-PRESIDENTS Armand Conant, B.Eng., LL.B., D.E.S.S. (Chair, Legislative Committee) Maclaren Corlett LLP Mario Deo, LL.B. (Chair, Public Relations Committee Member, Conference Committee) Fine & Deo LLP SECRETARY/TREASURER Bob Girard, B.Comm, RCM, ACCI (Chair: Special Projects Committee) AA Property Management & Associates

PAST PRESIDENT Janice Pynn, RCM, ACCI, FCCI (CCI National Liaison, CAI Liaison) Simerra Property Management Inc.

BOARD MEMBERS Gina Cody, P.Eng., M.Eng., Ph.D., ACCI, FCCI (Chair, Education Committee, CAI Liaison) Construction Control Inc. Henry Cohen (Member, Membership Committee) YCC #0074 Brian Horlick, B.Comm., B.C.L., LL.B., ACCI (Vice-Chair, Public Relations Committee) Horlick Levitt Barristers & Solicitors Lisa Kay (Member, Membership Committee, Conference Committee, Website Committee) Maxium Condo Finance Group Julian McNabb (Vice-Chair, Membership Committee) TSCC #1850 Vic Persaud, BA (Chair, Website Committee Member, Membership Committee) Suncorp Valuations Ltd. Bill Thompson, BA, RCM, ACCI (Chair, Membership Committee) Malvern Condominium Property Management

EX OFFICIO DIRECTOR Jasmine Martirossian, B.A., M.A., PhD.

ADMINISTRATOR - Lynn Morrovat ADMINISTRATIVE ASSISTANT - Josee Lefebvre

Features

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Condo Financing Options for an Environmental Retrofit

11 15 20 23 28 32 35 40 44 47

Condominium Insurance - Prudent Seniors Dictate

by Graham Banks

by John J. Molnar

Asbestos - What You Need to Know

by Gina Cody

Management Agreements - A Different Wrinkle

by Alan Rosenberg

Amalgamation

by J. Robert Gardiner

It’s Time to Future-Proof Your Building

by Rick Rakus

Five Steps to a Better Roof Installation

by Henry J. Jansen

Vacant Land Condos - Not Necessarily Vacant After All

by Janice Pynn

The Description: Lost in the Shuffle?

by Robert M. Mullin

Toronto Balconies Bloom

by Fern Mosoff & Gabriele Davies

Dealing with Condominium Owners Engaging in “Dangerous” Activities

by Christian Paquette

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Municipal Downloading of Waste Management

by Bob Girard

CCI News 5 38

President’s Message Members’ Corner: A Life Saved - A Defibrillator Success Story!

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Director’s Corner: Questions & Answers

by Mr. D.

49 52 56

New Members CCI Course Calendar Diversions & Distractions

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THE ONTARIO GOVERNMENT IS COMMITTED TO THE INSTALLATION OF SMART SUB-METERS THROUGHOUT THE PROVINCE

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THE TIME TO ACT IS NOW.

WHO WILL DELIVER

the smartest solution FOR INSTALLING SMART SUB - METERS ?

THE SMARTEST SOLUTION IS ONE OF THE MOST RESPECTED NAMES IN THE ENERGY BUSINESS. Escalating electricity prices can affect your bottom line, particularly if your building uses traditional bulk meters to measure electricity use. Enbridge Electric Connections delivers customized smart sub-meter solutions that lower operating costs and encourage energy conservation.

Smart sub-meters provide equitable allocation of electricity costs and studies show that when residents have control over their electricity bill, overall consumption decreases by up to 25%.

Whether you’re planning a new development or retrofitting an existing property, Enbridge Electric will seamlessly integrate a smart sub-metering solution

into your plans. It’s risk-free; there’s no capital cost, and cash flow is improved because Enbridge Electric pays the utility and bills the suites directly.

From installation and maintenance, to meter reading, billing, customer service, education and emergency response, Enbridge Electric delivers the industry’s most comprehensive smart sub-meter offering.

As part of North America’s leading energy distributor, Enbridge Electric is the smartest solution.

For a no-obligation evaluation, call Wendy Mortson at (905) 747–5571.

Have a building evaluation completed by May 2, 2008, and you will be entered for a chance to WIN a fantastic trip!*

*For full contest rules and regulations, visit us online at www.enbridgeelectric.com

President’s Message his has been a long, hard winter and I hope that March comes and goes gently and that spring is early. No matter what happens though, spring is on the way and the busy season for condominiums is just around the corner; whether you are planning for improvements, retrofits or major repairs and replacements, most of those projects take place in the good weather. As I look across the condominiums that I deal with and listen to others in the industry, Directors, Managers, Engineers and other suppliers, I am struck by just how much work is being done to improve the condition of condominiums.

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The “new” Condominium Act was proclaimed in 2001 and the requirement to prepare reserve fund studies and for the Directors to propose and follow funding plans that will result in adequate reserve funds has had a significant and positive impact on the condition of the condominium housing stock. I venture to say that, with just a very few exceptions, the deterioration in older condominiums has been stopped and is being reversed little by little, year by year and that these funding plans will ensure newer buildings will be able to maintain their condition indefinitely without the financial stress on their owners that special assessments and borrowing bring. A welcome and positive result with benefits for all who live and work in condominiums.

The Board of CCI continues to be very active; there are initiatives with the website, in our membership and education programs and in our magazine to name just a few. We welcome new Director Julian McNabb to the CCI Board. He is President of his condominium Board and has joined the membership committee with a special interest in initiatives for communication with owners. Our government relations committee, in conjunction with ACMO, has started its work and we are pleased with the early results. The Ontario government has indicated that it welcomes our participation in legislative areas that impact condominiums and we will be working with them to develop the mechanisms that enable us to do so.

Planning for our annual condominium conference, in conjunction with ACMO and in partnership with Rogers Cable, is in full swing and it will take place in a new location with more space to accommodate the increasing attendance. The conference will take place on October 31 and November 1, 2008 in the Markham Hilton Hotel and Conference Center at Highway 7 and Warden Avenue. Mark the dates on your calendar, it will be another great conference and look for the preliminary program this summer.

Finally, it is my pleasure and that of the entire Board of CCI to work for and with you as together we strive to improve condominiums and the lives of those that live in them. CCI’s mission is to be the Voice of Condominium and we welcome your comments to help us achieve that goal.

All the best to you and yours and I hope you get lots of time outside in the sun this summer

John Warren President, CCI Toronto & Area Chapter

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Condo Financing Options for an Environmental Retrofit

BY GRAHAM BANKS, MAXIUM FINANCIAL SERVICES INC.

ccording to a poll released by the Environmental Monitor on September 4, 2007, Canadians are now expressing alarm about climate change in greater numbers than any developed nation except France.

To do their part, Canadians are exploring ways to use less energy, conserve water and reduce waste. Fewer emissions mean protecting our climate and having cleaner air and healthier communities for all Canadians. This article identifies opportunities to create energy savings in Ontario condominiums, and discusses grants and loans as viable ways to pay for them.

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Continuing concerns about the environment, rising energy prices worldwide, and a commitment by Ontario policy makers to pursue a “soft energy path” are all contributing to an increasing interest by homeowners in energy retrofits. To close an imminent supplydemand gap, Ontario is continuing its

commitment to a “conservation culture” by promoting demand reduction as a complement to new generation capacity.

What does this mean to condo owners?

It means higher energy costs are inevitable and that incentives will likely remain available to encourage efficiency and conservation.

As a result of the new Condominium Act, most Ontario condominiums have a recently completed reserve fund study and have a funding plan in place. Many condos have struggled to make the funds meet the plan, resulting in increased fees and special assessments.

Finding additional money to implement new environmental retrofits is a challenge for many, because condo budg-

ets are full and owners are tapped out.

Undertaking environmental retrofits that save energy are likely the easiest to sell to the condo board because in many cases, they can be justified on economic grounds. Government grants coupled with a well-structured loan will provide a viable solution for many condominiums.

In most condominium buildings, engineers or energy management firms can identify measures that can be taken to create energy efficiencies. In many cases, the energy savings created outweigh the costs. Simple payback periods of two to ten years are common.

As energy prices soar, the arguments for undertaking these initiatives become ever more compelling. Higher efficienSpring 2008

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cy boilers, efficient lighting, and building automation systems are frequently recommended. Also, building envelopes can be improved to reduce heat loss with measures including improvements to windows, air sealing and insulation.

The cost of these measures can be offset by financial assistance programs available due to initiatives by various levels of government. That said, no incentive programs are currently offered to condominiums by the Government of Canada, which is consistent with the Conservative government’s abandonment of Canada’s previous commitments under the KYOTO Protocol and current lack of sound policy on the environment. For its part, Enbridge Gas Distribution as a component of its commitment to the Ontario Energy Board, provides incentives up to $30,000 per building for implementing multiple energy management initiatives. Electricity local distribution

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companies (LDCs) are also introducing incentive programs to promote energy efficiency.

In addition to what may be received from financial assistance programs, many condos will face up-front costs to implement recommended improvements. These costs are typically in the range of $200,000 to $800,000 for a high-rise condo complex. Often, to avoid depleting the reserve fund or creating a one-time special assessment to unit owners, it makes sense to finance energy efficiency measures with a loan.

If the condo board is seeking a loan for an environmental retrofit and the condominium is compliant with the Act, then securing the loan should be relatively straightforward. The lender will likely ask for full disclosure of the condo’s state of affairs. This will include information contained in a Status Certificate, audited financial statements and a copy of the reserve

fund study. The lender may also want comfort that processes are and will remain in place to collect any common expense contributions that are in default.

To enter a loan, the corporation must have a borrowing by-law in place, authorizing it to do so. Working with a lender who is able to provide their standard documentation specific to condos that are subject to Ontario’s Condominium Act will likely be most straightforward and cost effective. This documentation typically includes a loan agreement, a note detailing terms of repayment and a general security agreement. It is prudent to have your lawyer review the lender’s proposed documentation to ensure it is consistent with your understanding of the agreed deal terms.

The contractor will often require that milestone payments be made during the construction project based upon per-

centage of completion and subject to a holdback following substantial completion consistent with the Construction Lien Act. For larger projects it is prudent to use a Canadian Construction Documents Committee (CCDC) contract. CCDC contracts stipulate that a Consultant who oversees the project approves each payment. This provides an extra level of control to ensure that funds are advanced only after equipment is delivered and work is performed.

A “progress payment” loan that advances funds as and when required and pays interest only, prior to fixed loan commencement, is appropriate during the construction project. Upon project completion, a fixed rate loan will commence. With a fixed-rate loan, rates will not change during the term, irrespective of what happens to market interest rates.

Loan amortization periods are set in consideration of both the lifespan of the improvements and the anticipated energy savings they will create. Long-term assets warrant long-term loans to eliminate future interest rate movement risk and allocate costs over the timeframe they are enjoyed. The loan may often be structured to be cash flow neutral or cash flow positive. This means that the monthly loan payment is structured to be equal to or less than anticipated energy savings. In addition, once the loan is paid off, energy savings continue.

It’s not just alarm about climate change that has to drive energy efficiency initiatives in condos. A well thought out environmental retrofit plan will be embraced by green and frugal owners alike!

Graham Banks is Vice President of Maxium Financial Services Inc. He is a Chartered Financial Analyst (CFA) and has 20 years’ experience in structured, asset-based financing. Maxium Condo Finance Group delivers common element financing solutions to condominiums. ■

Financial Incentives for Energy Efficiency Retrofits The following incentives are available for energy management initiatives:

https://portal-plumprod.cgc.enbridge.com/portal/server.pt?space= CommunityPage&cached=true&parentname=CommunityPage&parentid=0 &in_hi_userid=2&control=SetCommunity&CommunityID=377&PageID=0 1)

Enbridge Gas Distribution’s Energy Audit Incentives Enbridge Gas Distribution offers financial rebates for energy auditing, based on the lesser of: A) $0.01/m3 of most recent full calendar year of natural gas consumption of the building; or B) ½ the cost of the audit up to $5,000

For multi-residential a minimum of 25% of savings identified must be implemented to receive the audit incentive.

2)

Audit incentive application and audit scope must be pre-approved by Enbridge and must materially meet the requirements of Enbridge’s Report Outline.

Enbridge Gas Distribution’s Incentives for Energy Retrofits Enbridge Gas Distribution offers financial incentives for energy retrofits, calculated on projected first year’s natural gas savings using the following rates: • $0.05/m3 saved up to a $100,000 limit (regardless of the number of measures) OR • $0.10/m3 saved up to a $30,000 limit (3 measures or more such as pipe insulation)

3) 4)

5)

Incentives are remitted upon project completion. Enbridge pre-approval is required.

NRCan’s ecoENERGY Retrofit Incentive for Buildings Natural Resources Canada’s ecoENERGY Retrofit Incentive did not offer any more funding in 2007. The 2008 program has not yet been announced.

OPA Electricty Retrofit Incentive Program (ERIP) Under ERIP the Local Distribution Companies (LDCs) are offering electrical demand management incentives to qualifying Institutional, Commercial and Industrial customers with an electricity demand of 50 kW or more. Incentives are provided at $150 per kW. The incentives are available for pre-approved projects that result in measurable reductions in electrical peak demand. http://www.everykilowattcounts.ca/HTML/BusinessPrograms/BusinessPrograms/ ERIP-overview.shtml

Water Conservation City of Toronto offers incentives for replacement of toilets: • $60 per low flow six-litre toilet installed.

• $75 per high efficiency toilet installed.

• $150 per rear-exit six-litre, or less, toilet installed.

• up to $150 per six-litre or less flush-valve toilet.

The City of Toronto offers property owners and managers up to $125 cash back for each new high-efficiency (HE) commercial washer that is purchased or leased.

http://www.toronto.ca/watereff/index.htm

Toronto Hydro – Announced August 22nd, 2007

https://www.torontohydro.com/electricsystem/business/bip/index.cfm

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Condominium Insurance Prudent Seniors Dictate

BY JOHN J. MOLNAR, BA, FRI, CPM(R), CRP, J.J. MOLNAR REALTY ADVISORS INC. nsurance companies started the slogan, “Freedom 55”, but few people will ever achieve it. Legislative changes prohibiting mandatory retirement at age 65 have allowed us to recalibrate and now aim for “Freedom 75”. More and more people, even though they are financially set, are choosing to work way beyond age 65.

I know some who are working well into their 80’s and who still climb the stairs two at a time.

board members who live by those four cardinal virtues and who have a great deal of spare time. If you’re lucky enough to be taken under the wing of one of them, count your blessings.

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With this changing trend, the market is cleverly responding with all sorts of products and services to take the enormous amount of loose change from the seniors’ pockets. For those without a lot of spare cash and who painstakingly worked to pay off their mortgages, there’s now the “reverse mortgage” with the jingle, “Wouldn’t it be nice”!

The condominium market has been burgeoning for years and there are many new developments catering especially to seniors. With them, our demographics are producing condominium boards populated by seniors, the majority of whom bring a lot of business experience and more importantly, the four cardinal virtues – Temperance, Fortitude, Prudence and Justice. I need not dilate on them.

After 33 years managing condomini-

The big benefit for condominium corporations is with this progressive focus on prudence and due diligence.

Younger property managers are likely to encounter many board members who can “outexpert” them on virtually everything – Roberts Rules of Order, personnel management, budgets and accounting, life safety systems, roofing, HVAC, landscaping and even property management itself.

ums – townhouses, conversions, hirises with multi towers and elaborate recreation facilities, industrial, office, mixed use, vacant land and freeholds – I retired from it. I did notice the emerging trend toward the dominance of senior governance quite some time ago. It was always those seniors who kept me on my toes with two key characteristics – prudence and diligence.

For today’s condominium and strata property managers, be aware that there is a rapidly increasing cadre of senior

Many of them know their Declarations, By-laws, Rules and Regulations cold, because they’ve read and pondered them. While the average property manager has from 8-10 sets of governance documents to administer, the prudent and diligent senior board member has and knows only one – usually inside out.

As senior board members exert more and more prudence and diligence in the governance of their condominium corporations, property managers and the whole host of enterprises serving the condominium market will be forced to fall in line. One subject that receives annual attention is the corporation’s Spring 2008

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insurance policies. Another that is monitored on a hit and miss basis, and which will come under ever increasingly closer scrutiny is ensuring that contractors and trades working in and around the condominium community have adequate liability insurance and certificates of good standing with the Workplace Safety and Insurance Board in Ontario (formerly the Workman’s Compensation. Board). A counterpart to this body exists in pretty well every province in Canada. Good managers know that they should get these certificates annually from their contractors, but the exercise often gets put on the back burner.

Beyond that, the new breed of senior board members will be demanding copies of the property management company’s certificate of insurance for errors and omissions and the same from their reserve fund planners. But these are topics for other articles.

Let’s take one insurance subject – property insurance – and examine it. There are four types of insurance for condominium or strata corporations: (1) property, which covers the building structures, improvements and assets of the corporation, (2) liability, (3) boiler and machinery (B & M), if there is common area machinery, and directors and officers (D & O). Each one warrants an article in itself, but because the largest premiums are paid out for the property portion of the insurance policy, it’s the best one to look at first.

Fortunately in Ontario, there isn’t a large claims loss history with condominium property policies and nothing that really would grab headlines. In fact, if you Google the internet for condominium property insurance or condominium insurance (Canada), you won’t find out much in the first several pages because they are full of web sites from brokers and agents selling “unit owner” packages.

In Ontario, the basics of what is required under the Condominium Act, SO 1998, Chapter 19 on property insurance appears below (right from the Act).

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INSURANCE

Property insurance 99. (1) The corporation shall obtain and maintain insurance, on its own behalf and on behalf of the owners, for damage to the units and common elements that is caused by major perils or the other perils that the declaration or the by-laws specify. 1998, c. 19, s. 99 (1).

(2) In subsection (1), “major perils” means the perils of fire, lightning, smoke, windstorm, hail, explosion, water escape, strikes, riots or civil commotion, impact by aircraft or vehicles, vandalism or malicious acts. 1998, c.

19, s. 99 (2).

Improvements not included (4) The obligation to insure under subsection (1) does not include insurance for damage to improvements made to a unit. 1998, c. 19, s. 99 (4).

Amount of recovery (7) Subject to a reasonable deductible, the insurance required under this section shall cover the replacement cost of the property damaged by the perils to which the insurance applies. 1998, c.

19, s. 99 (7).

Other insurance 102. The corporation shall obtain and maintain, (a) insurance against its liability resulting from a breach of duty as occupier of the common elements or land that the corporation holds as an asset; and (b) insurance against its liability arising from the ownership, use or operation, by or on its behalf, of boilers, machinery, pressure vessels and motor vehicles. 1998, c.

19, s. 102.

The first thing to know is that the corporation must have insurance for damage to the units and common elements caused by major perils or the other perils that the declaration or the by-laws specify. The Act then lists what are viewed to be “major perils”. In the property insurance industry, there are two types of coverage – (1) named perils, in which each and every peril is listed and only they are covered, and (2)

all risks, in which everything is covered except what is specifically listed in the “exclusions” section. Standard exclusions include Acts of God, Riot, War, Earthquakes and Floods (in certain high risk zones). You can get the coverage for some typical exclusions, but usually have to pay extremely high premiums for them.

The second thing to know is that corporations must insure their units and common elements for replacement cost.

Many Declarations even add the adjective “full” to “replacement cost”. Now full replacement cost doesn’t just include the labour and materials for replacing whatever has been destroyed.

It also includes all applicable taxes, and disposal and, in some cases, demolition costs related to the restoration. A good insurance appraiser knows these costs, which are indexed to your postal code.

Costs vary across the country, within each province and they even vary between such places as Oakville and Hamilton Mountain. This shouldn’t be a concern unless, of course, one is vastly under insured. If that’s the case, then your corporation runs the risk of being assessed the lion’s share of the difference between what your insured value should be vs. what you have listed.

This would be a horribly crippling financial blow in addition to the personal tragedies that would likely result from a catastrophic loss to the corporation. That’s where an insurance appraisal comes into play.

The Insurance Appraisal

An insurance appraisal is a replacement cost analysis providing an accurate estimate of the insurance amount required to replace each structure and/or amenity, exactly as it stands on the day the report was prepared.

Most Declarations require that the corporation regularly have an appraisal done by a qualified and independent appraiser in order to determine the full replacement cost. Yet not all corporations follow this specific directive in their own governance documentation.

A professional appraisal calculates the building’s reproduction cost on a component by component basis, using a combination of specialized software and various cost data specific to your area. It involves a comprehensive inspection to obtain field measurements and finishes.

Gone are the days of “drive by” appraisals. Today they are quite complicated when done diligently.

the inflation factor used in calculating your reserve fund requirements by your reserve fund planner.

Only a qualified and trained appraiser, who stays abreast of these changing material and labour costs, can ensure that your condominium or strata corporation’s building and amenities are

properly valued for their replacement cost in today’s dollars.

More and more diligent property managers and boards are calling for independent insurance appraisals on a regular basis in all likelihood due to the growing numbers of seniors populating condominium and strata boards.

Why Obtain an Insurance Appraisal?

Quite apart from complying with the corporation’s own Declaration, there are several other reasons to obtain an insurance appraisal. The first is that it demonstrates due diligence on the part of the board members, property manager and/or the insurance agent. You have the peace of mind of knowing that the corporation is properly appraised.

Second, it assists your agent in placing the proper coverage with a carrier, by providing documentation that underwriters need.

Third, it prevents under-insuring, which puts the corporation at risk of not having funds to rebuild in the event of a catastrophic loss, or over-insuring, which results in needlessly paying extra premiums.

Finally, it provides a third party with an unbiased evaluation of the property’s replacement cost. If a loss occurs, an appraisal, together with all data acquired during the appraisal, will be available to the corporation and insurer.

Recently, the cost of certain materials has increased dramatically. Stainless steel and other metals, as well as many products that are petroleum based, have been subject to very large inflationary pressure.

For a building, the Consumer Price Index should not be applied to the annual insurance premiums. This process is known as “trending up” and is not reliable at all. Buildings do not buy the items that make up the typical “bundle of goods” used to determine the CPI. The same principles apply to

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They’re reading their Declarations and seeing the section that calls for appraisals by independent and qualified appraisers.

As a former condominium manager, I was guilty of “trending up” for years, until I was called to task by a senior board member who knew the dangers inherent in that process. “An insurance appraisal”, he told me, “is much like zero based budgeting. You have to start fresh from the ground up, each time”.

Being truly diligent is being prudent and I was fortunate to have this “old dog” take me under his wing and teach me this valuable lesson. He embodied those four cardinal virtues Temperance, Fortitude, Prudence and Justice. I wish that for every young property manager looking after condominiums or strata corporations today, they find such a mentor.

This article was first published in The Exchange – Fall 2007 Edition, and reprinted with the permission of the Real Estate Institute of Canada.

John J. Molnar, BA, FRI, CPM®, CRP is President of JJ Molnar Realty Advisors Inc. in Hamilton, Ontario. John performs insurance appraisals in the Greater Toronto and Golden Horseshoe areas. His firm also does Reserve Fund Studies, Performance Audits and Technical Audits for new condominiums and conversions. For more than 33 years, he has been active as a property manager, project manager, reserve fund planner, insurance appraiser, instructor and consultant, both nationally and internationally. John has a degree in Urban Geography from McMaster University, holds his CPM® (Certified Property Manager®) and CRP (Certified Reserve Planner) designations from the Real Estate Institute of Canada and is a Trainer Marshall & Swift Appraiser. He is also a Fellow of the Real Estate Institute of Canada, who has served as a Director on its national board and chaired its Finance Council. His firm is listed on the web at http://www.jjmolnar.com. ■

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ASBESTOS What you need to know ASBESTOS MANAGEMENT PLAN A MUST AS OF NOVEMBER 2007

BY GINA CODY, P.ENG., M.ENG., PH.D., ACCI, FCCI CONSTRUCTION CONTROL INC.

sbestos was a popular material used widely in construction and many other industries. If asbestos fibres are enclosed or tightly bound in a product, for example in asbestos siding or asbestos floor tiles, there are no significant health risks.

Asbestos poses health risks only when fibres are present in the air that people breathe.

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Because asbestos is a valuable reinforcing, insulating and fire-proofing material, it was widely used in construction materials such as insulation board, asbestos cement, and floor and ceiling tiles. These products are very dense and do not release significant amounts of fibres under normal use. However, fibres may be released if these products are cut or damaged. Asbestos may be found in the insulation installed around your pipes in the boiler room, in the ceiling tiles, floor tiles, roofing material, caulking material, fire proofing material, drywall compound and other materials installed in your condominium.

The new regulations make it mandatory for all building owners, and in the case of condominium corporations, the board of directors to advise workers of the asbestos containing materials present in the building.

New Asbestos Regulations

There is no denying that asbestos is toxic. Obviously we want a safe working environment to ensure the wellbeing of anyone dealing with asbestos.

It should be noted that asbestos is the leading cause of death for construction workers. In Ontario, 84 per cent of all occupational disease fatalities between 1995 and 2004 were asbestos related, with mesothelioma (an asbestosinduced cancer) representing the vast majority of fatalities. We hear a lot about the dangers of being out in the sun for too long. But did you know that asbestos kills more Americans each year than skin cancer, according to recent U.S. statistics?

Building and maintenance workers are

especially at risk to asbestos-related disease. That is why many jurisdictions have put teeth into their regulations. For its part Ontario—with O. Reg 278.05 — has played catch-up to the U.S. Environmental Protection Agency and other jurisdictions.

The changes brought by Queen’s Park will no doubt increase worker protection.

Over the past few years, we have become familiar with liability issues related to mould and mould remediation. The new regulations for asbestos make this type of remediation as onerous as with mould. If you are removing drywall in excess of one square meter, and it contains asbestos, you now need to consider the procedures as mould remediation.

The regulations have not been loudly trumpeted so the changes may catch some by surprise. However the new rules were proclaimed by the government effective November 2005. O. Reg Spring 2008

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CONDOMINIUM SECTION

Maclaren, Corlett LLP is a full service law firm with offices in Toronto and Ottawa; both having significant condominium sections. The condominium section of the firm’s Toronto office is headed up by Armand Conant, and represents many condominium corporations in Toronto and the GTA. We work closely with our clients to find practical, cost effective solutions to problems.

For more information please contact: Armand G.R. Conant

186 St. George Street, Main Floor Toronto, Ontario M5R 2N3 Tel: (416) 361-3094 Fax: (416) 361-6261 Email: aconant@macorlaw.com www.maclarencorlett.com

Gardiner Miller Arnold LLP Barristers and Solicitors

GMA - The Condolawyers™ (Winning Condominium Law Solutions)

We led the battle for improvements to the new Act and Regulations

Our standard of excellence focuses on practical legal solutions for Condominium Boards J. Robert Gardiner Mark H. Arnold Gerald T. Miller Christopher Jaglowitz Warren D. Ragoonanan

1202 - 390 Bay Street, Toronto, Ontario M5H 2Y2 Tel: (416) 363-2614 Fax: (416) 363-8451 www.gmalaw.ca

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278/05, as it is called, replaced O. Reg 838/90 that was unchanged since 1985.

First you have to determine if there is asbestos in the building. Then you must notify the unit owners and tenants and implement a management program for the restoration and maintenance work.

The technical aspects are straightforward and determined by the testing.

After samples are drawn and taken to a lab, you will know within a week what is in store for the asbestos remediation and/or management.

O. Reg 278/05 revised and reclassified certain asbestos procedures for Type 1, 2 and 3 operations. When it comes to drywall with asbestos-containing joint compound, the removal of less than one square meter of drywall remains a Type 1 operation. Anything larger becomes Type 2. This requirement is in line with other provinces, such as Newfoundland, Alberta and British Columbia.

The cost impact in Ontario will be huge, considering that most buildings constructed with drywall prior to the

mid-1980s probably contains asbestoscontaining joint compound.

There’s a big difference between Type 1 and 2 operations. Type 1 procedures require little more than just dust control.

Type 2 is serious business – protective suits and respirators, site and air isolation, the wetting of the compound and the handling of the waste, and the more thorough reporting. Type 3 is the classification for larger remediation work. It includes measures relating to the spray application of sealant to friable asbestoscontaining material, or the repairing/demolishing of a building in which asbestos was used unless that asbestos was removed prior to March 16, 1986.

It remains to be seen how vigilant the Ministry of Labour will be in enforcing the new rules. But the legal repercussions for owners and employers can be daunting if proper precautions are not taken. A look at our litigious neighbours south of the border shows what may be in store. In 2003, more than 100,000 claimants sued in the U.S. for

asbestos related illness.

Another significant change with O. Reg 278/05 pertains to asbestos containing ceiling tiles. The removal of less than 7.5 square metres of tiles is classified as Type 1 work. A larger area is Type 2 removal. Again, it means significant added cost for the safe removal of asbestos containing ceiling tiles.

O. Reg 278/05 classifies asbestos materials according to friability. If something is friable, it can be crumbled, pulverized or powdered in your hand.

The more common friable asbestos containing materials include insulation on mechanical systems (pipes, tanks, boilers and ducts); sprayed or troweled fireproofing, insulation, soundproofing; texture and acoustic plaster; acoustic ceiling tiles and drywall installed with ACM joint compound prior to mid 1980’s (up to 1987!).

The non-friable ACMs used in construction cover materials such as vinyl

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floor tiles and sheet flooring; asbestos – cement (Transite) products, paper products and wallpaper; smooth plasters, acoustic tiles post 1982 and drywall installed with ACM joint compound.

Highlights of Ontario Regulation 278/05 – Asbestos on Construction Projects and in Building and Repair Operations • Defining “asbestos-containing material” as having at least 0.5 per cent asbestos by dry weight • Clarifying the responsibilities for asbestos management programs, including nonfriable asbestos in these programs

O. Reg 278/05 clearly spells out the new requirements for bulk samples in a survey. All asbestos-suspect materials must be tested or presumed to contain an asbestos type other than chrysotile.

You have to collect and analyse at least three samples of homogeneous materials. Any positive result for a set of samples affirms you have asbestos contained materials in your workplace – and you must follow proper safety and hazard protocols.

The new regimen also clarifies the responsibilities for an asbestos management program. You have to maintain a record showing friable ACM to November 2007 and all ACM (including non-friable) after November 2007.

If asbestos is found on site, it is the corporation’s responsibility to notify the occupants and the workers. Once the work is completed and the asbestos is removed or permanently enclosed (if it is friable fireproofing or insulation), the Condominium Corporation must have

the premises re-inspected at least annually.

The onus is on contractors to provide enhanced training for those on the job.

Workers have to be familiarized with the hazards of asbestos exposure and be trained in the use, cleaning and disposal of protective clothing and respirators.

Effective November 1, 2007, all workers and supervisors involved in Type 3 asbestos work need to successfully complete the Asbestos Abatement Worker or Supervisor Training Program approved by the Ontario Ministry of Training, Colleges and Universities.

It’s clear that O. Reg 278/05 has really beefed up the safety requirements for the construction industry. Be careful with asbestos. Otherwise you risk serious peril –a lawsuit by affected workers. ■

• Surveys require more bulk sampling • Reclassifying certain asbestos procedures for Type 1, 2 and 3 operations • Drywall removal with asbestos containing joint compound is now Type 2 if one square metre or more is removed • Existing asbestos management plans must be updated

by November 1, 2007 • Workers in Type 3 asbestos operations must complete a training program approved by the Ministry of Training, Colleges and Universities, as of November 1, 2007 • Significant changes to respiratory type for contaminated ceiling entry and many Type 3 projects • Air clearance sampling now required for Type 3 operations, except for demolition projects.

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MANAGEMENT AGREEMENTS

A Different Wrinkle

BY ALAN ROSENBERG A. R. CONSULTING

ecently, I heard someone say: “Management agreements should be fair to both sides.” Sorry, folks. Fairness has little or nothing to do with it.

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The Management agreement between a service provider and a condominium corporation must, as accurately and pragmatically as possible, incorporate the elements of the management routine deemed most suitable to that very condominium corporation.

Not so easy, is it? After all, who does the “deeming?” Management? The Board? An arbitrator? Judge Judy?

I don’t for one minute deny the need for standard, reasonable criteria in certain areas of condominium management agreements. These criteria are essential to the process of establishing principles of conduct, while maintaining at least a minimum “template,” if you will, of (a) management behaviour and (b) Board member expectations.

It’s those darned expectations, howev-

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er, that make condominium life intriguing. Why? Because those expectations are a moving target. As any manager will tell you, there is often very little consistency between: • what the Board expects and what the Board should expect • what the Board expects and what the condominium’s other residents expect • what one Board expects as opposed to another Board across town • what one Board member expects, as opposed to another member of the same Board • what (for instance) the new President expects as opposed to the outgoing President

At first glance, the obvious answer would seem to be one of almost selfdefense: a standard management agreement with specific, unchallengeable criteria, a document which leaves no room for doubt, and ignores the vagaries of the above list. In that scenario, the relationship between management and Board can be easily defined in terms of

standard “management duties and responsibilities” to be included in the management agreement, such as:

• term of agreement, termination clauses • collections, disbursement of CEA funds • enforcement of relevant legislation (declaration, by-laws, rules) • communication (Board and owners) • staff supervision • overseeing of trades, contractors • inspection and maintenance routines • contracts • inventory • emergency procedures • management reports • record keeping, statement reporting, budgets • meetings (Board and general) • indemnification provisions

These points cover most of what constitutes the minimum management performance standard. But what about the relationship between management and the Board? Is that fully addressed by the above list?

Stated another way, I always suggest to my clients and potential clients the following (A): formula: Management advises the Board on policy; (B): the Board uses this and all other relevant advice to set policy; (C): Management carries out this policy; (D): the Board makes sure step (C) takes place. For those of you, either Board members or management personnel, who have experienced frustrations of one sort or another in your professional condominium relationship(s) (namely everyone), can this formula be fully achieved using a management agreement incorporating the points listed above?

The answer may well lie hidden in the fourth point of the list: Communication to Board and owners. In fact, most agreements address this item in terms of: • advisement and consultation with the Board (re by-laws, etc, etc,etc)

one another on expectations, industry standards, realities versus misconceptions, and so on?

One might argue that the management monthly reports are a sufficient reporting vehicle. Or one might say that common sense usually prevails in professional relationships. (“Who needs a contractual clause telling the parties thereto to talk to one another?”)

• communication with the unit owners (by-law enactment, general meetings, etc)

But what happened to Communication with the Board? If Board/management conflicts are in any way caused by misinterpretations, inconsistencies in levels of understanding, differing expectations, general lack of knowledge of basic facts, and so on ad nauseum, shouldn’t the management agreement attempt to solve this most fundamental set of problems? Shouldn’t it be a contractual requirement for the Board and management to be regularly advising

I would respond by telling you that, in my travels, I see no shortage of common sense, heroic effort, and good intentions exhibited by unpaid Board members, and paid management personnel. Yet misunderstandings abound, even decades after the inception of condominium management. And from misunderstandings come discord, aggravation, lost contracts and upheaval.

Instead, what if the management agreement compelled the two parties to actually sit down periodically and talk to each other? What have we got to lose?

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THE CONDOMINIUM ACT, 1998 - A PRACTICAL GUIDE

AMALGAMATION J. ROBERT GARDINER, B.A., LL.B., ACCI, FCCI GARDINER MILLER ARNOLD LLP

A Daunting Task

There may be good administrative reasons and eventual cost-savings for amalgamating two or more sister corporations into one condominium, but in view of the effort, expense and the high percentage of unit owners’ consent required, it should not be expected that amalgamation is either straight-forward or easy. Amalgamation may make sense for sister corporations which have much in common, but the more mixed uses involved, political egos, financially-different approaches or construction deficiency problems, the less likely the directors will get the beast to flap its wings in unison. The due diligence investigations applicable to amalgamation of condominium corporations tends to be more rigorous than your average star-struck human courtship leading up to marriage (where lovers sometimes find that despite their best efforts, they have acquired a pig in a poke).

declaration and description if the board of each amalgamating corporation has held a meeting of owners to consider those documents [s. 120 (1) and (2)].

The owners of at least 90% of the units of each corporation as of the date of its meeting must, within 90 days thereof, consent in writing to registration of the amalgamating declaration and description, and the corporations must comply with all prescribed requirements. The written consent must not be executed before the meeting of owners and must be signed by the individual owner or persons authorized to bind a corporation or a mortgagee, but not under proxy [O. Reg. 48/01), s. 31 (4)]. It is ironic that the owners of at least 90% of the units of each corporation are required to agree to an amalgamation, whereas a vote of only 80% of the owners and the written consent of 80% of the mortgagees is required to terminate a corporation upon consent or upon sale of all or part of the property. The 90% consent requirement will be extremely difficult to achieve.

90% of Owners Consent [s. 120]

Two or more freehold or leasehold corporations of the same type may amalgamate by registering an amalgamating

Due Diligence

No corporation may amalgamate unless it is a standard condominium corpora-

tion. If it is a phased condominium corporation, all phases must be completed, or more than seven years must have passed since registration of the declaration and description that created the corporation. A turnover meeting must have been held and, to the best of the knowledge of the board, the declarant must have delivered all required turnover documents.

Each of the amalgamating corporations must have conducted a comprehensive reserve fund study or an on-site update within the year before the board gives the owners notice of a meeting of owners regarding the amalgamation [O. Reg. 48/01), s. 31].

The board of directors of each corporation will want to conduct due diligence and require written opinions from their engineers, auditors and lawyers on a wide number of topics ranging from a review of performance audits, other technical audits and reserve fund studies, settled and outstanding construction deficiencies litigation and Tarion warranty claims, first year budget shortfall claims, any other litigation, proceedings or claims, minute book reviews, a complete financial review, Spring 2008

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an analysis of contracts and a whole host of other issues. The boards will have to decide how to make suitable adjustments amongst the corporations with respect to various liabilities, assets, risks and benefits, long before seeking final approval from the owners. A series of communications to all unit owners is a wise initiative. The lawyers of the corporations should lead the project and coordinate resolution of

the check list of amalgamation items, with support from the auditor and property manager.

Interim Amalgamation Agreement

An interim amalgamation agreement must be executed by the corporations to establish a unified approach to the amalgamation, dealing with the con-

duct of the affairs of each of the corporations until they amalgamate or until their boards determine that the amalgamation will not proceed [O. Reg. 48/01), s.31].

The interim amalgamation agreement would contain a number of covenants and on-going indemnities which would protect each of the corporate parties and their owners. O. Reg. 48/01, s. 31 (2) requires the interim amalgamation agreement to deal with expenditures from the reserve fund, borrowing of funds, making, amending or repealing by-laws and considerations with respect to entering into new contracts. Add to that list any existing or proposed legal proceedings, any substantial addition, alteration or improvement to the common elements, any substantial change in the assets of the corporation, and any substantial change in a service that the corporation provides to the owners.

Documents Provided to Owners

The board must give the owners notice of the meeting to amalgamate, by providing a copy of the proposed amalgamation declaration and description and a copy of the proposed budget for the corporation’s first year of operation, together with a copy of all proposed bylaws and rules of the amalgamated corporation.

Each board must provide to its owners a prescribed form of certificate of status for each of the amalgamating corporations, together with the auditor’s report on the last annual financial statements of each amalgamating corporation. The status certificates must be dated no earlier than the fourteenth day before the day the board gives the owners the notice of meeting described in s.

120 (3) of the Act.

Other statements and information are prescribed in detail by O. Reg. 48/01), s. 31 (3). Certainly owners will be interested in knowing all about the reserve fund summary, funding plan summary, statement of differences and investment plan of each of the amalgamating corporations.

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Mortgagees Excluded but Continue

Most mortgagees are not entitled to receive notice that owners are being requested to provide their written consent to the amalgamation. However, mortgagees of record [s. 47 (2)] will be entitled to receive notice of the meeting of owners of each amalgamating corporation. Few of the mortgagees are likely to be mortgagees of record and few will exercise their rights under their mortgage to supersede the owner’s right to sign or refuse the written consent to amalgamate. As s. 121 (1) (c) indicates, all encumbrances of the predecessor corporations are constituted as encumbrances that continue to affect the particular unit or common elements of the amalgamated corporation [s. 120 (3)].

Amalgamated Declaration and Description

The declaration of an amalgamated corporation must not be registered unless the duly authorized officers of each amalgamating corporation have signed the amalgamated declaration. O. Reg. 48/01, s. 33 sets out a number of requirements pertaining to the content, execution and registration of a declaration of amalgamating corporations, s.

34 exempts the description effecting an amalgamation from s. 8 (1) (b) and (e) of the Act and s. 35 establishes a number of criteria applicable to reserve fund studies for an amalgamated corporation.

Some corporations may encounter difficulty in determining a formula for readjusting the common interests and common expenses attributable to the units of the amalgamating corporations.

Presumably some amalgamating corporations will have different types of unit boundaries and a different set of maintenance and repair obligations, although the boards would likely try to work out an equitable basis to define those issues. In each case, boards will have to consider each of the declaration provisions and either adopt common provisions or accept individual provi-

sions where appropriate. No doubt, the amalgamated declaration will eliminate ancient, inconsistent, irrelevant or problem-causing provisions from the amalgamating declarations, by-laws and rules and bring them up to modern standards in accordance with the new Act, human rights and case law requirements. It can be expensive to create a new description; hopefully the Ministry and Land Registrars will allow the existing descriptions to be utilized by re-designating and distinguishing each of the same units on the same level of each of the separate amalgamated corporations [s. 120 (4)].

Termination Not Applicable

Part VIII (s. 122 - 129) pertaining to termination of a condominium upon consent, or upon substantial damage, or upon sale of property, or upon expropriation, or upon termination by the court does not apply to an amalgamation. Once the corporation has amalgamated, all of the Part VIII provisions are applicable if one of those events occurs in the future.

The rights of dissenters and the distribution of assets applicable to termination of a condominium do not apply in the case of an amalgamating corporation [s. 120 (5)].

Results of Amalgamation [s. 121]

Upon registration of an amalgamating declaration and description, each of the corporations are amalgamated and continue as one corporation. The units and common interests of the amalgamating corporations are continued as units and common interests in the amalgamated corporation.

All encumbrances, easements and leases that affected the units or common elements of the individual corporations are continued and affect the amalgamated corporation accordingly. All of the previous declarations, descriptions, by-laws and rules of the amalgamating corporations cease to apply. Directors Continued on page 27 Spring 2008

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of the amalgamating corporations constitute the first directors of the amalgamated corporation. The by-laws and rules proposed by the board of directors in the notice to owners sent pursuant to s.120 (3) (b) become the bylaws and rules of the amalgamated corporation (until it amends or replaces them). The amalgamated corporation possesses all the assets, rights and privileges and is subject to all liabilities (including civil, criminal and quasicriminal obligations) of the amalgamating corporations. A conviction against or a ruling, order or judgment in favour of or against an amalgamating corporation may be enforced by or against the amalgamated corporation. The amalgamated corporation is deemed to be the party plaintiff or defendant in all civil actions commenced by or against an amalgamating corporation before the amalgamation becomes effective. All contracts, agreements, warranties and debts of each of the amalgamating corporations belong to the amalgamated corporation.

Amalgamations of business corporations involve similar criteria which have functioned effectively when carefully-drafted documents have been accompanied by due diligence.

Post-Amalgamation Tidy-Ups

The amalgamating corporations should advise their insurers regarding the pending amalgamation. One of the insurers will likely survive the amalgamation, while the other’s services will likely terminate, hopefully subject to a rebate of prepaid premiums on a short rate basis. The new insurer must be informed in writing of the correct amalgamated corporation name and all of the amalgamated property and assets, subject to an up-to-date replacement value insurance appraisal.

The amalgamated certificate of status may require adjustments with respect to a statement of the address for service of the corporation, the names and addresses for service of directors and officers, a copy of the new budget, the Continued on page 43

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It’s Time to FutureProof Your Building

BY RICK RAKUS, COO AND GENERAL MANAGER ENBRIDGE ELECTRIC CONNECTIONS INC. ack in 2004, our company was working on its very first installation of smart sub-meters in a condominium residence. The building developer we were working with coined a phrase that, to my mind, is a succinct statement of the benefits of this new technology. He said he was moving forward with smart sub-meters in order to “future-proof the building”.

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This developer had a talent for spotting trends. In the past four to five years, about 50,000 smart sub-meters have been installed in multi-resident buildings in Ontario. In 2008 alone, I estimate another 50,000 smart sub-meters will be installed, bringing total coverage to about 18% of the 560,000 condominium units now in the province.

While it is doubtful there is a condominium manager in Ontario who is unfamiliar with smart sub-meters, allow me to provide a brief description. Smart 28

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sub-metering puts residents in multiunit residential and commercial buildings in control of their own electricity costs by using a dedicated meter to measure the electricity used in each individual unit. Smart sub-meters integrate time and use; in effect, they measure not only how much electricity is used but when it is used enabling customers to take advantage of low cost electricity prices under the Ontario Energy Boards Time of Use pricing plan. Smart sub-metering lets occupants pay only for what they use, rather than paying an arbitrary amount based on a predetermined formula, as in the case in bulk-metered buildings.

In August 2007, new Ontario regulations were announced to enable implementation of smart sub-meters as part of the Government’s Energy Conservation Responsibility Act of March 2006.

When these new regulations came into effect on December 31st, condomini-

um boards now have the authority to make smart conservation decisions on the installation of smart sub-meters in their buildings – a trend that has been growing for years.

Whether or not smart sub-metering should be mandatory for all condominium and rental buildings has been a subject of heated debate in the industry.

Some condominium boards have argued that the decision should be left in their hands. Indeed, many condominium boards have done their homework on the benefits of smart submetering and are planning on moving ahead in the new year.

In response to these concerns which were expressed during consultations with the industry, the Government amended the regulations. All new condominiums constructed after January 1, 2008 will have mandatory installation of smart sub-metering systems or smart

meters; for existing buildings or new buildings close to occupancy, the decision will be made by the individual condominium board.

For new condominium construction, the regulation simply gives legal standing to a trend that was already well under way. Just four years ago, about 95% of all new condominium buildings were bulk-metered, and electricity costs were embedded in maintenance fees complicating condominium board’s budgeting decisions. New regulations have brought this to 100% beginning in 2008.

Many suppliers believe that smart-submetering is in the best interest of individual condominium owners and apartment renters. Furthermore, universal application of the smart sub-metering program will help alleviate pressure on the province’s electricity supply and benefit the environment as more people take advantage of cost savings from time of use pricing and conservation.

That having been said, the industry debate itself has been healthy and has raised awareness of the economics of smart sub-metering. The proof can be found, shall we say, in ‘A Tale of Two Conferences’.

At the spring Association of Condominium Managers of Ontario luncheon (ACMO), discussion centred on how to persuade the government to abandon mandatory requirements and do nothing in the interim. At the fall Canadian Condominium Institute (CCI/ACMO) conference, however, the tone and substance of debate was markedly different. Having learned in August that mandatory requirements for existing buildings were off the table, conference delegates shifted their attention to conservation and the need for each building to carefully examine its own energy use patterns and determine if smart submetering would deliver cost savings to their buildings.

This discussion is certainly timely.

Ontario Power Generation recently applied to the Ontario Energy Board for a 14% rate hike on the commodity cost of electricity, which it estimates will elevate the typical homeowner’s electricity bill by $3.50 per month. While the OEB has not yet ruled on the application, it is a fair assumption that both the commodity and distribution cost of electricity (the latter being the cost of distribution by electric utilities) are on an upward trend. This will drive up the energy budgets of condominiums for both individual owners and for energy usage in common areas. Smart submetering is a key tool in mitigating these impacts and in helping condominium boards minimize condominium fee increases for their members.

Another factor influencing condominium boards is the growing prevalence of smart meters throughout the province.

Through its Smart Meter Initiative, the Continued on page 31

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THE ONTARIO GOVERNMENT IS COMMITTED TO THE INSTALLATION OF SMART SUB-METERS THROUGHOUT THE PROVINCE

–

THE TIME TO ACT IS NOW.

WHO WILL DELIVER

the smartest solution FOR CONTROLLING ELECTRICITY COSTS ?

THE SMARTEST SOLUTION IS ONE OF THE MOST RESPECTED NAMES IN THE ENERGY BUSINESS. Escalating electricity prices can affect your bottom line, particularly if your building uses traditional bulk meters to measure electricity use. Enbridge Electric Connections delivers customized smart sub-meter solutions that lower operating costs and encourage energy conservation.

Smart sub-meters can reduce peak energy demand and studies show they decrease overall electricity consumption by up to 25%.

Whether you’re planning a new development or retrofitting an existing property, Enbridge Electric will seamlessly integrate a smart sub-metering solution

into your plans. It’s risk-free; there’s no capital cost, and cash flow is improved because Enbridge Electric pays the utility and bills the suites directly.

From installation and maintenance, to meter reading, billing, customer service, education and emergency response, Enbridge Electric delivers the industry’s most comprehensive smart sub-meter offering.

As part of North America’s leading energy distributor, Enbridge Electric is the smartest solution.

For a no-obligation evaluation, call Wendy Mortson at (905) 747–5571.

Have a building evaluation completed by May 2, 2008, and you will be entered for a chance to WIN a fantastic trip!*

*For full contest rules and regulations, visit us online at www.enbridgeelectric.com

Government is targeting smart meters in 800,000 homes by the end of this year, and all homes and small businesses throughout Ontario by 2010. And as mentioned earlier, all condominiums built after January 1, 2008 will have smart sub-metering. This points to a growing gap between bulk-metered buildings on the one hand, and new condominiums and single family homes with smart meters on the other hand.

Over the next two years, there will be increasing publicity from the Government on how to gain maximum advantage from smart sub-meters, and far greater media attention as the meters are installed in homes throughout the province. As awareness grows of the economic and environmental benefits of smart metering, condominium owners in bulk-metered buildings will be increasingly conscious of – and unhappy with – their cost disadvantage.

Finally, there is the possibility that the Government will advance its conservation agenda and 2010 smart meter plan to include smart sub-metering throughout the condominium and rental sectors. Recently, FRPO, the Federation of Rental-Housing Providers of Ontario recommended that the Ministry of Energy mandate the installation of smart sub-meters throughout the rental housing sector within the next three years. With a healthy majority and renewed mandate, the current Government is likely to press its conservation agenda more aggressively.

I am convinced, however, that the impetus for change will be the obvious benefits of smart sub-metering rather than the prospect of mandatory legislation for all condominiums. For progressive building managers and condominium boards, the time to “future-proof” their buildings has arrived. ■

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Five Steps to a Better Roof Installation HENRY J. JANSEN, P.ENG.

oof evaluation, maintenance and replacement are some of the most troublesome aspects of managing a condominium community. In Ontario it is especially challenging due to the demanding climate to which our roofs are subjected. Wind driven rain will often cause leaks in even the best roof systems.

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Roofs are typically a large portion of the building surface. Unless you live in or manage a high rise complex where the roof represents a small portion of the total surface of the building, the cost of replacing a roof can be quite significant.

A roof is one of the most expensive components in a building to replace.

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roof is usually replaced all at one time.

Therefore, this large expenditure must be borne in one year. This makes the decision to replace a roof a difficult one for building owners and managers. The temptation is to postpone the inevitable for one more year. A roof can be nursed along year after year, but this is likely to prove to be a false economy.

In the long term it makes economic sense to replace a roof earlier rather than later. If the life of a roof is extended much beyond its useful life, maintenance costs are likely to increase beyond prorated replacement costs.

There is also the danger that water penetration (some of which may not even be noticed) will cause damage to the underlying structure or other building components. The reduction in insulation value of wet insulation and the resulting increases in heating and cool-

ing costs are other factors that contribute to making roof replacement a good economic decision. Finally, the liability of a major failure must be considered.

Thus, roof problems are among the most frequent areas of concerns for condo communities. Here are a few thoughts about roofs that may be helpful to your community.

Surface materials have been improved There are many roof materials on the market today. Those that we see most often in Ontario are:

Shingles – these consist of a composite base (asphalt, fibreglass, etc) and sand wearing surface. They are relatively

one specifically trained and experienced with flashing work.

easy to install and moderately priced.

The thickness (weight) generally defines the likely service life. In other words, a thicker shingle will last longer.

The weight is given as pounds per square (100 square feet equals one square).

Workmanship makes the difference Roof problems are more frequently the result of poor workmanship than material deficiencies. While there have been some defective roof materials, our experience has shown us that workmanship is more commonly the problem.

Membrane roofs – these have become the primary way to cover flat roofs within the last twenty years. Membrane roofs are typically somewhat more expensive than the other alternatives for flat roofs. However, they generally last longer and have fewer maintenance problems.

Metal roofs – metal roofs are becoming more common in northern Ontario.

There are a variety of reasonably good products on the market. Metal roofs are used on sloped surfaces.

A successful metal roof is very dependent on good workmanship. Unskilled hands installing a metal roof will almost always lead to problems.

Flashing is at least as important as the surface The roof is a system that includes the sheathing, underlayment, flashing and the roof surfacing. If you are having

problems with your roof it is important to understand that there are several different components involved. Many times, only the roof surfacing (shingles, membrane, etc.) is considered when trying to diagnose a problem.

The roof flashing is as often the cause of leaks as the roof surfacing.

Repairing flashing requires skill.

Caulking flashing leaks is not adequate.

If there is a flashing problem, the only effective repair usually requires installing new flashing. That work, to be successful, must be done by some-

When you select a roofer you should check their references and identify exactly who will be working on, and responsible for, the crew doing your roof. Good roof work is challenging, particularly working on a roof under demanding physical and climatological conditions. Good roof work is also essential to a watertight result.

Five steps to a better installation How can you avoid turning routine roof maintenance into a roofing nightmare?

Here are some suggestions: 1.

When you evaluate your existing roof, make sure you have an independent consultant. If you ask a

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2.

roofer to evaluate your roof, it is very likely that the conclusion will be that the roof needs to be replaced very soon.

limitations (for example; clean the site every day, don’t start working before 7:30 AM, etc) do you expect as it relates to work on the job site.

When you decide to install a new roof, you should prepare a detailed set of construction documents.

The documents should:

- define exactly how you expect things to be done; what is the scope of the project, what materials are to be used, what is the intended schedule for completion, what requirements and/or

- be very specific about the materials to be used.

3.

- be very specific about how waste material is to be handled.

You should retain the services of a consultant to prepare the construction documents and to monitor the work while it is underway. As a corporation, you need someone

knowledgeable about the construction industry who does not have any direct interest in your project other than serving your best interests.

4.

2.

You should choose time proven materials. There are many new building products coming on line all the time. You should not experiment with untested products and/or installation techniques.

You should make sure there is a written guarantee against problems with both material deficiencies and workmanship for at least 3 – 5 years. A bond should back the guarantee so that you are covered even if the company who installed the roof goes out of business.

Roofs are expensive and disruptive to install. Diagnosing problems objectively is difficult. You should always work with a good, independent consulting engineer or roofing consultant. That person can help evaluate problems, prepare construction documents for repair or replacement and monitor the work to be sure it is done well. Using a consultant also means that the directors of the corporation are less vulnerable to liability from the owners.

Henry J. Jansen, P.Eng. is president of Criterium - Jansen Engineers, an engineering firm that provides building inspections, reserve studies, and related services. Criterium – Jansen Engineers is affiliated with Criterium Engineers which has been serving North America since 1957. ■

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Vacant Land Condos Not Necessarily Vacant After All

BY JANICE PYNN, EXECUTIVE VICE PRESIDENT SIMERRA PROPERTY MANAGEMENT INC.

ho would have guessed that when the Condominium Act, permitted the development of vacant land condominiums (VLC) that this type of development would actually resemble a subdivision of single-family homes.

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Like standard condominiums, vacant land condominiums have units and common elements. When purchasing a standard unit condominium you purchase a completed home/unit. Purch-

chase of the condominium unit. So at the end of the construction of the “approved” buildings the VLC is a subdivision. The roadways, entrances and landscaped areas are the common elements shared by all unit owners.

The owners are often caught off guard when they learn that the roadways, street lights and services such as garbage collection, are usually maintained and paid for by the unit owners unlike a subdivision wherein the municipality pays for

ments even though the maintenance burden of these items has been transferred to the unit owners.

The condominium corporation is set up and operates much like a standard condominium corporation with a board of directors; however the board and management face different challenges in the vacant land environment.

The corporation does not insure the units. Owners are required to purchase

The condominium corporation is set up and operates much like a standard condominium corporation with a board of directors; however the board and management face different challenges in the vacant land environment. asing a unit in a vacant land condominium is like buying a blank canvas. Now, how is it then that you end up with a “subdivision of homes”?

A VLC starts out with a unit void of buildings; however the VLC’s declaration sets out what type of buildings and a date by when the building must be built. Most builders offer the building of the dwelling unit as part of the pur-

the road services. I say ‘usually’, because in some municipalities, the services are being offered. I sense, however, that it is because the municipality does not understand that the roads are private. The “services” issue appears to be an unfair situation because the cost of the services is not adjusted in the taxation base. The Municipal Property Assessment Corporation (MPAC) has not made adjustments to the tax assess-

a home policy, which includes all the structures/buildings and possessions located on the unit. This is quite different from the regular condominium policy wherein the owner’s policy is limited to personal belongings, betterments and improvements and liability responsibilities. Owners who live in a vacant land corporation need to review their coverage to avoid any disappointment as many insurance brokers do not Spring 2008

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While this new type of condominium has brought on challenges in understanding and operating the VLC, those that have been developed so far are some of the most beautiful communities that we have had the pleasure of managing. understand the requirements of a vacant land condominium.

In accordance with the Condominium Act, the corporation is not supposed to provide services to the unit such as driveway snow removal and/or grass cutting to the units, however for the most part, this requirement is being ignored and the corporations are including these maintenance items in their budgets. The service of snow removal and grass cutting is generally quite welcome, however some VLCs also maintain flowerbeds, much to the dismay of many residents who still enjoy gardening. The control and supply of water through irrigation systems is also an issue when supplied and maintained by the corporation, as owners do not always agree on the amount of watering that the corporation may deem reasonable.

causes dissention in the community.

These corporations have very few contracts to manage as the common elements for the most part are roads and landscaped areas. On large VLCs, however, the delivery of road services like snow removal is a challenge, as the site personnel and equipment required, is greater than the average site requirement. The VLCs that emulate a subdivision have not provided for rest areas or storage facilities for equipment.

Some sites are so large that the services are continual. In other words there is grounds care equipment arriving on site daily to take care of one area or another.

While this new type of condominium has brought on challenges in understanding and operating the VLC, those that have been developed so far are some of the most beautiful communities that we have had the pleasure of managing. In spite of the issues mentioned above, the standards and conditions set out in the declaration result in a community that has consistency in applications and tangible expectations that hold value well. I hope that Developers continue to promote and build vacant land condominiums, and who knows maybe someday there will actually be a vacant one. â–

The corporation is required to ensure that the unit owners abide by the detailed building and use requirements as set out in each VLC declaration.

Requirements include driveway products, paint colours, roof types, home size and use, plant material in gardens, allowed changes to gardens, exterior lighting, fencing, pools, hot tubs etc.

The challenge is the homeowners understanding of the restrictions and their willingness to abide by the restrictions.

It has been our experience that many of the homeowners who have purchased a vacant land condominium want the freedom to maintain and decorate their unit as they wish and these restrictions are often a disappointment to the uneducated buyer. The resulting infractions cause a burden to the board, to the owners who have purchased because of the restrictions, and to management in policing the restrictions, which in turn Spring 2008

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Members’ Corner

A Life Saved A Defibrillator Success Story!

SUBMITTED BY YCC # 510

hen the Board of Directors of YCC #510 in downtown Toronto authorized the purchase of three defibrillators and arranged for the training of staff in their use, it was hoped that they would never have to be used.

W

However, on Monday November 26th, 2007 the quick thinking of staff members saved the life of a male condominium resident when he collapsed in the lobby with what appeared to be a heart attack. The doorman, Mohammed Bade, and the concierge on duty, Steve King, instinctively knew what to do.

While one called 911 and arranged for Ashfaq Ahmad, the doorman on duty at the neighbouring tower, to cover the front desk, the other brought the defibrillator to the stricken resident.

They followed the procedure as dictated electronically by the machine and then began to apply CPR, just as they had been trained to do. Yuriy Namolovan, another staff member also assisted.

When the ambulance arrived, paramedics indicated that the patient would never have survived had they not promptly done their job. He was taken 38

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L-R: Ashfaq Ahmad, Steve King, and Mohamed Bade. Missing from the photo is Yuriy Namolovan who was also part of the lifesaving team.

to the hospital where he has since recovered completely.

Everyone appreciates the efforts of Steve, Mohammed, Ashfaq and Yuriy, especially the family members of this

individual. In a thank you letter to the Board, the wife of this gentleman says “I wish, in particular, to direct my sincere and heartfelt thanks to Mohammed Bade and Steve King for saving my husband’s life on November 26th, when they used the defibrillator machine to reactivate his heart. Doctors and nurses at the hospital assured us that he would not have survived had they not acted promptly and efficiently. I would also like to thank the condominium board members for their foresight in purchasing these machines.”

Defibrillators at YCC # 510 are located in the lobby of each tower as well as in the recreation centre. ■

Director’s Corner

QUESTIONS & ANSWERS BY MR D.

Check Out the CCI Bookstore

I am the owner of a townhouse condo unit and I plan to be away for a couple of months. I did arrange with my neighbour to check on my unit once a week, however, the Manager of the complex is insisting on a twice-a-week check up procedure. Is he right?

Q

To the best of my knowledge this is not a condo problem but an insurance requirement. The owner should check his/her homeowner's policy and I believe that somewhere in the fine print it will mention a 48 hour period when one leaves the premises. The master policy of the corporation probably also has a requirement an inspection by the manager every 15 days. The inspection is prudent in any event for obvious reasons. Of course the condo in question might have a by-law or rule covering this eventuality, where once again, the owner should check his/her documentation.

A

If you have a question for Mr “D” please send it to Editor, TheCondoVoice, ccitoronto@taylorenterprises.com.

DONNA SWANSON ACCI, FRI

Real Estate Brokerage

at

www.ccitoronto.org Resource material for Condominium Owners, Managers and Boards of Directors

For your Real Estate Needs call: 416-515-2121

• Real Estate Broker of Record - s peci al i zi ng i n Co ndo mi ni um Sal es since 1982 • Current condominium Owner & Di recto r and a Pas t Pres i dent • ACCI - An Associate of the Canadian Condominium Institute • Pas t Di recto r of Toronto Chapter of CCI • FRI - Fellow of the Real Estate Institute of Canada and current Di recto r of Toronto Chapter of REIC

Email: donnaswanson@sympatico.ca

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The Description: Lost in the Shuffle?

BY: ROBERT M. MULLIN, B.A. (HONS.), LL.B.i SMITHVALERIOTE LAW FIRM LLP

Introduction If one were to poll a group of directors or property managers on the documents that govern a condominium corporation, it is likely that the words, “declaration”, “by-laws” and “rules” would quickly follow. Given their importance, many directors and property managers have been guilty of keeping dog-eared copies at the ready. As careful and prudent stewards of the corporation, they know that these documents require careful understanding and routine consultation.

Although significant variations may occur from condominium to condominium, by virtue of the Condominium Act, 1998, S.O. 1998, c.19; (“the Act”), a condominium’s particular declaration, by-laws and rules govern its affairs.

Although these documents are often kept within ready reach, there is one condominium document that is, at best, a murky afterthought.

At a recent Canadian Condominium Institute Level 200 course, a large group of volunteer directors were asked by the speaker, “How many have reviewed their condominium’s description?” A few wary and reluctant hands rose. The speaker then asked, “When should a director refer to the description?” Both the hands and silence fell.

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Unfortunately, for many condominium corporations, the description has long since been lost in the shuffle, an unknown tool awaiting use.

What is the Description?

If a condominium’s declaration, bylaws and rules may be analogized to a nation’s constitution, laws and regulations, a condominium’s description may be likened to a country’s map. The description illustrates a condominium’s physical features and boundaries, over which the Act, the declaration, by-laws and rules govern.

In fact, section 2 of the Act puts both the declaration and description as the ‘front-and-centre’ documents of any condominium corporation. Only once a declaration and description are registered will a condominium corporation be created. While section 7 of the Act lays out the components of a declaration, section 8 of the Act specifies what must be included in a description. To paraphrase, a condominium’s description must include: a) a plan of survey, showing the perimeter of both the land and buildings; b) the boundaries of units;

c) diagrams demonstrating the shape and dimension of each

unit, and the location of units in relation to other units;

d) all interests appurtenant to the land;

e) architectural and/or structural plans of the condominium; and, f) necessary surveying, engineering and architectural certifications.ii

That said, what does the description look like? The description typically consists of several large survey style white sheets, measuring 36” x 24”. If you have seen them, you will likely remember them. They can easily cover the average kitchen table. Pursuant to regulation iii, there are two main elements of a description, being the survey (Parts I and II) and the plans (Parts III and IV).

1. The Survey Parts I and II contain the survey-like depiction of the condominium corporation. The condominium is literally laid out in a map like format showing the boundaries of units (eg.: the residential or commercial units, unitized parking spaces or unitized storage lockers), the common elements (eg.: the roadway, playground, or community centre), and the exclusive use common elements (eg: the balconies, the back-

yards or common element parking spaces). Mandatory ‘heavy-lines’ will signify the actual surveyed boundaries of the units and the exclusive use common elements. Each unit must be designated by the word “Unit”, and followed by its corresponding number, while exclusive use portions must also be designated by a number, letter or both. The survey is drawn to scale, allowing the depth of an exclusive use backyard, or the width of a townhouse unit to be measured and understood. iv

In addition, easements must also be shown on the description. These ‘white sheets’ will often number 3 to 11 large sheets, and when either folded or rolled make a handful.v 2. Architectural or Structural Plans

Parts III and IV of a description include the condominium’s architectural and/or structural plans. The net effect of these documents permit a thorough understanding of the physical attributes of the building(s), sufficient to reconstruct the building(s), if necessary.vi Generally, pursuant to regulation, architectural plans are not required if structural or ‘engineering drawings’ are included in the description. These Part III and IV documents can easily add another 15 to 50 large dimensions sheets.vii

The description typically consists of several large survey style white sheets, measuring 36” x 24”.

If you have seen them, you will likely remember them.

How Do I Get the Description?

Parts I and II, or the description’s survey sheets, can generally be retrieved from the land registry office in short order with nominal copying costs.

Parts III and IV, being the architectural and/or structural plans, should have been provided to the condominium corporation by the Declarant at turnover, pursuant to section 43(5) of the Act. That said, these documents can also be retrieved from the registry office, albeit with greater cost and time.viii Once the complete description is obtained, many professional printing shops will reduce these large and unwieldy sheets

to a smaller standard document size, such as 8.5” X 11”, easily fitting alongside the declaration, by-laws and rules.

Why Seek Out the Description?

Having, and understanding a condominium’s description is an invaluable tool to carefully overseeing any condominium corporation. Property managers should have a reduced copy during on-site inspections. Reference to the description may quickly determine if the attractive patio furniture is on either the common elements (ie: not permitted) or the exclusive use common element backyard (ie: permitted). Having the description on hand will aid in unit boundary disputes, understanding precisely the condominium’s property boundaries, and what easements cross the condominium’s property. Reviewing the description is often essential to determine responsibility in respect of damage and insurance claims, and is necessary to properly prepare a standard unit definition. The inevitable question of who is allowed to park where, may be resolved by resorting to the description to determine the location of exclusive use entitlements. In summary, condominium corporations would be well served to seek out this continued on page 42

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document, and add it to their quiver of dog-eared tools.

Robert Mullin, B.A. (Hons.), LL.B., is a lawyer at SmithValeriote Law Firm LLP in Guelph. Robert practices extensively in the area of condominium law and development, currently completing his Masters of Law at Osgoode Hall Law School. Robert currently serves as a director for CCI’s Golden Horseshoe Chapter. He can be reached at rmullin@smithvaleriote.com. i

ii

42

Research and editorial assistance was kindly provided by Ms. Sandra Smith, student-at-law, SmithValeriote Law Firm LLP. The Condominium Act, 1998, S.O. 1998, c.19, section 8; (“the Act”).

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In addition to the Act, two regulations govern the contents and procedures for registering a description, being O. Reg. 48/01 and 49/01, with particular emphasis on the latter. iv Loeb, A. Condominium Law and Administration (Thomson Carswell: 2007, Looseleaf), at pgs.

3-84 to 3-86. v Gardiner, Robert J., The Condominium Act, 1998: A Practical Guide, (Canada Law Book Inc.: 2001) at pgs. 27-28. vi Supra iv, at p.3-86. vii Supra. v, at pg. 27. viii Supra. v at pg. 27. ■ iii

Amalgamation Continued from page 27

reserve fund status, audited annual financial statements and reports, an amended number of units recorded in the lease record and other prescribed material. In addition, many of the documents referred to or enclosed with the status certificate must accordingly be amended. An Address for Service will be filed in the Land Registry office. In some cases, the amalgamated corporation may continue with the various agreements for supplies of goods and services, property management and utilities (especially when long term contracts cannot be terminated, while in other cases the corporation may find it beneficial on a volume basis to terminate or re-negotiate some shorter term contracts) [s. 121 (1)].

Subsequent Directors & Auditors

The first directors of the amalgamated corporation hold office until the owners elect their successors at a meeting which the first directors must call and hold within 60 days following registration of the amalgamated declaration and description. The first directors of the amalgamating corporations constitute all of the directors of the amalgamated corporation, but once the owners’ meeting is held, the successor directors are elected to fill the number of director positions as set out in the by-laws of the amalgamated corporation, subject to all of the provisions normally applicable to directors and officers discussed in s. 27 - 41 [s. 121 (3)].

Immediately following the registration of the amalgamated corporation’s dec-

laration and description, the directors must appoint one or more auditors who shall hold office until termination of the meeting of owners to elect the directors of the amalgamated corporation. At that meeting the owners must appoint successor auditors in accordance with the requirements set out in s. 60 - 62 [s. 121 (2) and (4)].

J. Robert Gardiner, BA, LLB, ACCI, FCCI, is Senior Partner of Gardiner Miller Arnold LLP, a Bay Street law firm focused on condominium law. He is past-President of the Canadian Condominium Institute (Toronto & Area) and chaired its education, legislative and condo-conference committees. â–

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Toronto Balconies Bloom A project to promote balcony gardening in Toronto

BY FERN MOSOFF & GABRIELE DAVIES oronto Balconies Bloom is conceived as an umbrella for many possible activities and future directions. It’s a way to get helpful information on balcony gardening and supplies into people’s hands and inspire increased gardening activity by residents of different types of buildings. It’s a concept to strengthen the links among the various interests in Toronto’s balcony gardening world.

T

A balcony garden contest is being planned for this summer. The competition is considered, above all, to be a vehicle to stimulate interest and participation in balcony gardening. The aim is to encourage gardeners within individual buildings, apartment neighbourhoods or self-identified groups to organize themselves so that the contest can focus on communities, not only on individuals. Contest categories will address the range of circumstances and people that balcony gardening touches - for example, best building/community participation, best use of recycled materials, most 44

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creative display, most environmentally tolerant/friendly, best kitchen garden, most sustainable.

It is a wonderful prospect to green Toronto’s balconies by tapping the energy of gardeners across diverse economic, age and ethno-cultural groups. It’s hoped that the concept will capture the imagination and energy of condominium communities throughout the city.

Currently, there are two individuals spearheading this campaign on a voluntary basis. Gabriele Davies is a certified Landscape Designer and Horticulturalist, passionate to see more balcony gardens in the city, and Fern Mosoff is a novice, but cheerful, gardener with an academic background in urban planning and many years of government experience developing projects.

Look for a follow-up in the next issue of CondoVoice to see how this exciting project is developing and how you can get involved.

For more information, contact:

Although this project is just developing, the response has been very enthusiastic. As the initiative continues to evolve, the ideas and support of interested individuals and organizations are most welcome.

Fern Mosoff magmos@sympatico.ca

Gabriele Davies gdaviesdesign@sympatico.ca 416-654-9472 www.LIKEdesigns.com 416-904-7217 ■

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When “Personal Service Beyond The Contract� Really Counts!

There Is Only One Name

Property Management Services Inc. 1256 Cardiff Blvd., Unit A Mississauga, Ontario Phone: (905) 696 (8376) Fax: (905) 696-0729

jvero@veropropertymanagement.com www.veropropertymanagement.com Condominium Property Management Specialists

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Dealing with Condominium Owners Engaging in

“Dangerous“ Activities

BY CHRISTIAN PAQUETTE HEENAN BLAIKIE LLP

n owner carrying on an activity likely to cause damage to the condominium property or to an individual can be subject to a compliance order obtained by way of application to the Superior Court of Justice. These include activities which likely pose a health risk to the condominium community (mould spreading throughout the building for instance), a risk of damaging other units or common elements (the threat of water damage or fire hazards for instance) or a risk of causing injury to other members of the condominium community (aggressive behaviour from a resident such as assault or threatening behaviour for example). Section 117 of the Condominium Act, 1998, S.O. 1998, c.

19 (the “Act”) reads:

A

Dangerous activities

117. No person shall permit a condition to exist or carry on an activity in a unit or in the common elements if the condition or the activi-

ty is likely to damage the property or cause injury to an individual.

The corporation must be careful to limit its relief to the confines of s. 117 of the Act as opposed to the by-laws, regulations and declaration, or it risks being sent back to mediation or arbitration by the court.

To succeed in an application for a compliance order grounded in s. 117 of the Act, the corporation must provide sufficient evidence that the owner’s activities present a real risk to other individuals or to the condominium property on a balance of probabilities. It is interesting to note that s.117 is worded in such a way that it could encompass activities posing a risk to any person on the condominium property, whether they be owners, tenants, guests or employees of the condominium corporation.

The following cases provide a useful overview of how the courts have interpreted the scope of dangerous “activi-

ties” or “conditions” which are prohibited under s.117 and subject to a compliance order by way of application.

In Metro Toronto Condominium Corp.

No. 545 v. Stein (2005), 53 C.L.R. (3d) 155 (Ont. C.A.), the Court of Appeal upheld the decision of a trial judge in dismissing an application under s. 117 of the Act regarding mould contamination in the heating and cooling system of certain units. Fatal to the condominium corporation’s application was the fact that the engineer retained by the corporation to advise on the mould issues did not expressly state in his report that the mould contamination in the unit created a risk of contaminating other units. Moreover, the corporation did not produce evidence that a drain pan in a unit had overflowed in other units or that overflowing pans posed a risk for mould contamination.

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allegations that mould contamination or overflowing pans constituted a risk of damage to property.

Conversely, in Goldenthal v. York Condominium Corp. No. 74, 2002 CarswellOnt 2790 (Ont. S.C.J.), the Court held that piles of books and paper accumulated in a unit were the type of prohibited dangerous conditions contemplated under the former s. 117 of the old Condominium Act. The condominium corporation managed to convince the court that the piles of paper constituted a dangerous condition based on photographic evidence of the large piles of paper as well as a previous report from the fire department clearly indicating that the hoard of paper presented a fire hazard. This case also suggests that the smell of dank water and smoke entering the air conducting system of a condominium building could also constitute a health risk.

Applications alleging a “risk of injury” based on an owner’s aggressive behav-

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iour raise more difficult questions.

Indeed, such allegations are often based on observations of witnesses which may or may not resist a cross-examination and tend to be of a subjective nature.

In York Condominium Corp., No. 136 v.

Roth (2006), 51 R.P.R. (4th) 140 (Ont. S.C.J.), the corporation alleged that an owner repeatedly engaged in “unmanageable and antisocial behaviour” and that his conduct presented a risk of injury to other individuals. The trial judge held that most of the evidence constituted hearsay and that most of the reported incidents occurred many years before the application. The personal animosity towards the owner exhibited by one of the corporation’s witnesses also had an impact on the weight of the corporation’s evidence. Ultimately, the judge found support for a compliance order in the uncontradicted evidence that the owner had disrupted an owner’s meeting and had physically assaulted the corporation’s president.

In Carleton Condominium Corp. No. 291 v. Weeks, 2003 O.J. No. 1204 (Ont. S.C.J.), the Court granted interim injunctive relief to the corporation against an owner who engaged in quarrelsome and threatening behaviour towards other residents. The Court was convinced by the testimony of three witnesses which had maintained their position under cross-examination. Their evidence was that the owner had “flipped the finger” at another resident and her 12 year-old daughter and “repeatedly glared in an aggressive manner” at them. Interestingly, the Court gave no credence to the corporation’s argument that the same owner risked damaging the condominium property by slamming doors, breaking windows, and throwing objects in the common elements. According to the judge, there was “minimal evidence” that the owner had engaged in such conduct.

The above case law suggests that applications based on s. 117 of the Act will

largely turn on the quality and reliability of the evidence presented by the corporation. Applications alleging a “risk of damages” should include evidence in the form of photographs, video footage, expert reports or expert testimony clearly setting out the likelihood of damage to property.

On the other hand, applications regarding alleged threatening conduct should be supported by contemporaneous incident reports and witness statements, as well as photographs or video surveillance footage if possible. Witness statements are key in such proceedings and should be able to withstand crossexaminations by opposing counsel. As is usually the case in any litigation, hearsay evidence, mere subjective opinions, or biased testimonials should generally be avoided as they tend to affect the weight of the evidence.

In other words, the more documented the incidents, the better the chances of the corporation succeeding in its application for a compliance order under s. 117.

Christian Paquette is a litigation lawyer at Heenan Blaikie and works with Denise Lash as part of the condo team of Heenan Blaikie. www.heenanblaikie.com ■

New Members

Welcome to the Following New CCI Toronto Members Corporate Members MTCC # 1138 TCECC # 1811 TCECC # 1836 TSCC # 1825 TSCC # 1841 TSCC # 1850 TSCC # 1852 TSCC # 1862 TSCC # 1863 TSCC # 1879 YCC # 0168 YCC # 0289 YRSCC # 1098

Individual Members D. Boswick P. Griffin D. Jubb K. Payne J. Polito W. Zhang

Henry Jansen Criterium-Jansen Engineers

Professional Members Lisa Jeffery Holman Insurance Brokers Ltd. Feng Lu Aim Home Realty Inc.

Ava Stone Summa Property Management Inc.

Trade Members

Matt Sullivan Nu Flow Technologies Inc.

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THE ONTARIO GOVERNMENT IS COMMITTED TO THE INSTALLATION OF SMART SUB-METERS THROUGHOUT THE PROVINCE

–

THE TIME TO ACT IS NOW.

WHO WILL DELIVER

the smartest solution FOR REDUCING YOUR OPERATING COSTS ?

THE SMARTEST SOLUTION IS ONE OF THE MOST RESPECTED NAMES IN THE ENERGY BUSINESS. Escalating electricity prices can affect your bottom line, particularly if your building uses traditional bulk meters to measure electricity use. Enbridge Electric Connections delivers customized smart sub-meter solutions that lower operating costs, so you can reduce rent or condo fees while improving your building’s efficiency.

Smart sub-meters provide equitable allocation of electricity costs and studies show that when residents only pay for what they individually use, overall consumption decreases by up to 25%.

Whether you’re planning a new development or retrofitting an existing property, Enbridge Electric

will seamlessly integrate a smart sub-metering solution into your plans. It’s risk-free; there’s no capital cost, and cash flow is improved because Enbridge Electric pays the utility and bills the suites directly.

From installation and maintenance, to meter reading, billing, customer service, education and emergency response, Enbridge Electric delivers the industry’s most comprehensive smart sub-meter offering.

As part of North America’s leading energy distributor, Enbridge Electric is the smartest solution.

For a no-obligation evaluation, call Wendy Mortson at (905) 747–5571.

Have a building evaluation completed by May 2, 2008, and you will be entered for a chance to WIN a fantastic trip!*

*For full contest rules and regulations, visit us online at www.enbridgeelectric.com

Municipal Downloading of Waste Management

BY BOB GIRARD

Beginning on or about July 1, 2008 the “City of Toronto“ will introduce a new “Utility Bill“ which will combine solid waste fees with water and sewer fees.

The “User Pay System” or the “ Volume-based solid waste rate system “ is initiated to raise additional revenue necessary to achieve the 70% diversion goal and provide a financial incentive to residents to reduce waste.

Fees are based on the volume of waste set out each month.

• Less than 0.142 cubic yard/unit/month will receive a credit of $0.58 per unit per month • 0.142 to 0.227 cubic yard/unit/month will be charged a fee of $1.50 per unit per month • 0.227 to 0.453 cubic yard/unit/month will be charged a fee of $4.00 per unit per month • 0.453 to 0.680 cubic yard/unit/month will be charged a fee of $6.50 per unit per month

For multi-unit residential buildings, waste in excess of 0.680 cubic yards per unit per month for un-compacted waste or 0.227 cubic yards per unit for compacted waste (compacted ratio is 3:1) will be billed on a cubic yard basis at a rate of $9.56/cubic yard/month.

For budgeting purposes $4.00 per month per unit would be appropriate on average if your building has good recycling habits, with 3.5% yearly increases.

Check out the “Members Only” section on the CCI Toronto Website!

www.ccitoronto.org Spring 2008

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Now Available Reserve Fund Essentials

by Jonathan H. Juffs and Graham Oliver Members $20, Non Members $22 plus shipping and taxes.

Order online at: www.ccitoronto.org/ONLINEBOOKSTORE

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G.S. Atkin Property Management Specialist Inc. One Shady Lawn Court Mississauga, Ontario L5N 1H2 24-Hour Emergency Line (905)-567-6820 Direct Line: (416)-258-6011 Fax: (905)-567-6930 Website: www.gsa-pm.com Email: info@gsa-pm.com

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Upcoming Events

Mark Your Calendars!

Springfest 2008

President’s Club Networking Dinner

Date: Wednesday, April 9th, 2008 Location: Metro Toronto Convention Centre – North Building Time: 9:45 am to 10:45 am

Date: Tuesday, April 15th, 2008 Location: Novotel Hotel North York – 3 Park Home Ave. Time: 6:00 to 9:00 p.m.

Cost: $35 for CCI Members $60 for Non-Members

Asbestos Management Plan Moderator: Gina P. Cody, P. Eng., M.Eng., PH.D., BDS, FCCI President Construction Control inc.

Speaker:Robert Reid, Industrial Hygienist, Construction Control Inc.

This session deals with the New Asbestos Regulation and its requirements for compliance by all building owners and Managers. As of November 2007, all buildings must have an Asbestos Management Plan in place, which would identify all “asbestos containing material” in the building and if asbestos is found on site, it is the owner’s and Board of Director’s (in case of Condominium Corporations) responsibility to notify the building occupants and workers working in the building.

Also - Visit the CCI Booth in the Trade Show area of the Springfest show between 10:00 a.m. and 2:00 p.m.

Condo 101 Course Date: Time: Location: Cost:

Saturday, April 12th, 2008 9:00 a.m. until 12:00 p.m.

Novotel Mississauga Hotel $60 for CCI Members $95 for Non Members

This half-day seminar will focus on the topics that every Director should be aware of and will provide participants with a basic knowledge of the condominium Act. The course is an excellent means to find out what you need to know to be effective as a condominium owner or director. The information presented will be of interest to those purchasing a condominium or to those who want to know what a condominium is and what it means to live in one.

To register for this CCI Toronto event and/or to obtain further information, please visit the website at www.ccitoronto.org or call the office at (416) 491-6216.

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Join Us for a Networking Dinner for Condo Presidents is pleased to offer a unique opportunity for Condo Presidents to meet for dinner and to network with other corporation Presidents to hear about problems other corporations face as well as the solutions that have worked for them.

Seating will be arranged to include a CCI condo expert at each table to facilitate group discussions. Participants will have the opportunity to present to the group any general problems faced by their corporation and see how others would respond.

To register for this CCI Toronto event and/or to obtain further information, please visit the website at www.ccitoronto.org or call the office at (416) 491-6216.

CCI Toronto Advanced Course Dates: Tuesday, May 6th, 13th, 20th and 27th, 2008 Time: 7:00 p.m. to 10:00 p.m.

Location: Novotel Hotel North York – 3 Park Home Ave. Cost: $200 for Members $275 for Non Members

Designed for the dedicated condominium director, the CCI Advanced course will run for four consecutive Tuesday evenings from 7:00 p.m. to 10:00 p.m. beginning May 6th, 2007 through May 27th, 2008. Upon completion of the course, participants should understand all aspects of reserve funds, major repairs and replacement, financial management, common problems and solutions, legal responsibilities… and in the last session, learn about mediation/arbitration and the new enforcement remedies available under the Condominium Act, 1998.

To register for these CCI Toronto events and/or to obtain further information, please visit the website at www.ccitoronto.org or call the office at (416) 491-6216.

Condo Humour

Copyright Š 2008 David Medhurst (International) Inc. Used With Permission

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Diversions & Distractions

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Can you find the hidden name of the CCI-National Leader?

(Answer in the next CondoVoice – or in the members only area of the CCI Website at: www. ccitoronto.org) 56

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accordance act add annual area aroma banking basis bind board call can carried cast certify contracts copy

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Total Security Solutions for Condominiums • • • • •

Visitor entry phones Access control Video surveillance Hands-free parking control 24/7 alarm monitoring

Lorne Middleton Manager, Sales & Operations, Central Ontario 5201 Explorer Drive Mississauga, Ontario L4W 4H1

Phone: 905-206-8458 Fax: 905-206-8486 lmiddleton@chubbsecurity.com www.chubbsecutiry.com

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List of Advertisers A.R. Consulting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .53 ACMO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42 Adams & Miles LLP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39 Arthur Fire Protection Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .57 Atrens Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18 Atrens Management Group Inc. . . . . . . . . . . . . . . . . . . . . . . . .25 Brady & Seidner Associates Ltd. . . . . . . . . . . . . . . . . . . . . . . . .16 Brokers Trust Insurance Group Inc. . . . . . . . . . . . . . . . . . . . . . .10 Brook Restoration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34 Brown & Beattie Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10 Canlight Hall . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8 Carma Industries Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13 Certified Clean Air Services . . . . . . . . . . . . . . . . . . . . . . . . . . . .36 Chubb Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .57 Condominium Living Management . . . . . . . . . . . . . . . . . . . . . .6 Construction Control Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .60 Corpland Contracting Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18 CPL Design Interiors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29 Davroc Consulting Engineers . . . . . . . . . . . . . . . . . . . . . . . . . .41 Donna Swanson Real Estate Brokerage . . . . . . . . . . . . . . . . . .39 Dryerfighters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19 D-Tech (Nexus) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .37 E.J. Walsh & Co. Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27 Enbridge Electric Connections . . . . . . . . . . . . . . . . . . . . .4, 30, 50 Enerplan Building Consultants . . . . . . . . . . . . . . . . . . . . . . . . .58 Essential Landscaping Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .57 Fine & Deo Barristers & Solicitors . . . . . . . . . . . . . . . . . . . . . . . .2 Firenza Plumbing & Heating Ltd. . . . . . . . . . . . . . . . . . . . . . . . .57 Fogler, Rubinoff LLP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .53 G4S Security Services Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45 Gardiner Miller Arnold LLP . . . . . . . . . . . . . . . . . . . . . . . . . . . .16 Genivar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .43 Gerald R. Genge Building Consultants Inc. . . . . . . . . . . . . . . .26 GSA Property Management Specialists Inc. . . . . . . . . . . . . . . .53 Gulesserian Associates Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . .21 Heenan Blaikie LLP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .48 Holman Insurance Brokers Ltd. . . . . . . . . . . . . . . . . . . . . . . . . .39 Horlick Levitt Barristers & Solicitors . . . . . . . . . . . . . . . . . . . . .18 ICC Property Management Ltd. . . . . . . . . . . . . . . . . . . . . . . . . .31 J.J. Molnar Realty Advisors Inc. . . . . . . . . . . . . . . . . . . . . . . . .49 Jansen Engineers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10 JCO & Associates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14 Larlyn Property Management Ltd. . . . . . . . . . . . . . . . . . . . . . . .43 Les Consultants Ingenium (Condo Manager Software) . . . . .51 M & E Consulting Engineers Ltd. . . . . . . . . . . . . . . . . . . . . . . . .56 Maclaren Corlett LLP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16 Maple Hill Tree Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18 Mareka Property Management Inc. . . . . . . . . . . . . . . . . . . . . . .17 Martin K.I. Rumack Barrister & Solicitor . . . . . . . . . . . . . . . . . .38 Maxium Condo Finance Group . . . . . . . . . . . . . . . . . . . . . . . . .10 Metro Group of Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . .33 Miller Thomson LLP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14 Morrison Hershfield . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .53 Nadlan-HarrisManagement . . . . . . . . . . . . . . . . . . . . . . . . . . . .36 Ontario Screen Systems Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . .46 Percel Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31 Pro-House Management Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . .57 Provident Energy Management . . . . . . . . . . . . . . . . . . . . . . . .24 Rikos . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .46 Rogers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .59 Samuel Property Management Ltd. . . . . . . . . . . . . . . . . . . . . .36 SR Wise Management Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26 Stratacon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .52 Summa Property Management Inc. . . . . . . . . . . . . . . . . . . . . .57 Suncorp Valuations Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .57 Toronto Star . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22 Vero Property Management Services Inc. . . . . . . . . . . . . . . . .46 Waste Solutions Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16 Whiterose Janitorial Service Ltd. . . . . . . . . . . . . . . . . . . . . . . .27 Wilson Blanchard Management Inc. . . . . . . . . . . . . . . . . . . . . .42

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“TheCondoVoice” is published 4 times per year – Spring, Summer, Fall and Winter, by the Canadian Condominium Institute - Toronto & Area Chapter.

Magazine Directors: Mario Deo & Brian Horlick Editor: Ruth Max Advertising: Marie McNamee Composition: E-Graphics

All advertising enquiries should be directed to Marie McNamee at (905) 852-2802 or marie@mcnamee.ca, or cci.toronto@taylorenterprises.com.

Publications Mail Agreement #40047005 - Return undeliverable Canadian addresses to Circulation Dept. 2175 Sheppard Ave. E., Suite 310, Toronto, ON M2J 1W8

The author, the Canadian Condominium Institute and its representatives will not be held liable in any respect whatsoever for any statement or advice contained herein. Articles should not be relied upon as a professional opinion or as an authoritative or comprehensive answer in any case. Professional advice should be obtained after discussing all particulars applicable in the specific circumstances in order to obtain an opinion or report capable of absolving condominium directors from liability [under s. 37 (3) (b) of the Condominium Act, 1998]. Authors’ views expressed in any article are not necessarily those of the Canadian Condominium Institute. All contributors are deemed to have consented to publication of any information provided by them, including business or personal contact information.

Consider supporting the advertisers and service providers referred to in this magazine, recognizing that they have been supporters of CCI. Advertisements are paid advertising and do not imply endorsement of or any liability whatsoever on the part of CCI with respect to any product, service or statement.

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