Tony Gioventu
Province

Dear Condo Smarts: Thank you for your timely column on election signage a few weeks ago. Our strata is unclear on one issue. Can we create a bylaw or rule that prohibits the size of signs that are placed on a strata lot or common property?

— MM, Abbotsford

Dear MM: Our offices province-wide have been inundated with the same question.

Yes, section 228.1 of the Election Act permits a landlord, a person or a strata corporation to limit the size of a sign by setting reasonable conditions.

However, what a strata corporation has to remember is that to set conditions on a strata lot would require a duly ratified bylaw at a general meeting that has been registered in the Land Title Registry. A strata corporation may prohibit signs on common property, including common areas of a building, and that may be either through a proper bylaw amendment or through the creation of a Rule by council. The new Rule must be properly ratified by council and the strata must inform owners and tenants of any new rules as soon as feasible.

A strata corporation in White Rock has a bylaw that limits the placement of election signage to only the display from strata lots, and to signage no larger than one metre by one metre, which is still significant. In a bare-land strata in most circumstances it will require a bylaw to limit or restrict signage. Most signs are displayed on the property adjacent to the buildings on a bare-land strata, which is almost always part of the strata lot.

Don’t make the mistake in assuming the Act gives you the authority to limit or restrict signs. The Strata Property Act is silent on election signage, and only gives you the ability to create the appropriate bylaws or rules permitted by the Election Act.

Tony Gioventu is executive director of Condominium Home Owners’ Association. [email protected].

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Tony Gioventu
Province

Dear Condo Smarts:

In the heavy rains recently, we discovered our living room almost flooded, which appears to be the result of an open window.

We were quite confused as to how this could happen because our building has very large overhangs. We contacted the council and were told, “It’s in your suite; it’s not our problem.”

That includes our damaged hardwood floors the developer installed and several pieces of our furniture. Not including the drywall damage, the cost is easily going to exceed $10,000. Shouldn’t our insurance pay for this?

On top of it all, we noticed the gutter above our unit has all but collapsed, which is the likely the culprit and the source of the flood.

Our building is only three years old and we’re told by our manager that this should also be a warranty claim. Between the warranty and our insurance, who pays for what damages?

— SF, Mission

Dear SF: The warranty on the building envelope covers the general building exterior systems for five years.

To determine if it is a warranty claim, the cause of the gutter failure needs to be established.

Your strata must also have the building system inspected to confirm there is no other damage or failures.

If any are discovered, contact your warranty provider and builder to set up a repair schedule.

The damage to the common assets of the building from an insured peril and the damage to your personal property are different than a warranty claim to the building.

The original hardwood floors, if they were installed by the developer, are part of the common assets of the strata corporation and, yes, they fall under your strata insurance policy.

Your building has never filed an insurance claim so your deductible is well below the cost of the damage that would include the floors, drywall and other common assets.

Your personal property, such as furniture or antiques, are items that are insured separately by each owner. If, however, the strata corporation was aware of the failure of the gutters, and chose not to effect any repairs, there may be sufficient reason for you to claim your personal damages against the strata corporation as well.

With proper homeowner insurance and the coverage of the strata policy, your costs should be minimal.

No matter what, get your strata council to fix these gutters immediately, before more damage occurs or your warranty is placed in jeopardy.

Tony Gioventu is executive director of the Condominium Home Owners’ Association. Send questions to him at [email protected]. The association’s website is www.choa.bc.ca.

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surveillance: Strata must have a policy for intent and disclosure of information collected

Tony Gioventu
Province

Dear Condo Smarts: Our strata of two highrise buildings in Burnaby has encountered what we hope is a rare problem. We recently had to gain access to a strata lot in an emergency due to a burst pipe. The pipe was a broken toilet feed and the problem was quickly resolved with little building damage.

Now the juicy part. On entering the strata lot, our council discovered boxes of videotapes stacked everywhere in the unit.

On closer inspection, we noticed the labels identified different parts of our building, including our lobby, parking garage, pool and mail room.

A council member removed one of the pool tapes to discover several hours of surveillance of pool activities being recorded. To our surprise they include a nude bather and a couple engaged in inappropriate activities in the hot tub. How can we prevent owners from recording the channels that monitor our building? They’re intended for safety and security, not the invasion of or recording of the owners’ activities.

News has travelled in our strata and everyone now wants cameras removed. It’s a little too creepy thinking one owner is recording all of our activities.

— DC, Burnaby

Dear DC: Thank you for your timely letter. My previous column addressed the collection of personal information under privacy laws, but there are also matters of public and private surveillance that are regulated under PIPA.

Your strata urgently needs legal advice on these matters.

If a strata corporation intends to operate a surveillance system on common areas, it must establish a policy for the intent, collection, storage and disclosure of the information that might be gathered. This is best served with an enforceable bylaw or a rule published as a policy that specifically identifies all of these subjects.

Some conditions might also require the appropriate signs — for example, in a pool or hot tub area.

Whether you realize it or not, if you operate a closed circuit TV system, both the strata and the owners will likely be collecting personal information. If that CCTV is an accessible channel that every resident can pick up, you may not be complying with privacy requirements.

It is also necessary to disclose that purpose to the residents and owners before you gather any information.

On the topic of emergency entry to a strata lot, the strata corporation or emergency service providers do have provisions under the standard bylaws to access strata lots without notice.

However, personal information gathered or the removal of any objects from a property without the consent of the resident is theft.

Even though the occupant was recording condo TV, the strata corporation would not have gained such knowledge had they never removed personal property.

If you become aware of a security situation as a result of emergency access, contact the police.

Tony Gioventu is executive director of the Condominium Home Owners’ Association. Email: [email protected].

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Council invoking act to make it difficult for owners to call a special general meeting

Tony Gioventu
Province

Dear Condo Smarts: Our owners have just found out the council has overspent our annual budget by 30 per cent on frivolous items. We petitioned for a special general meeting to remove our strata council, but the property manager and council refuse to call the meeting and refuse to give us the list of owners and alternative mailing addresses.The Strata Act says they must keep these records, and they have to provide them on written request, but the property manager said the Privacy Act overrules that and they don’t have to give them to us.

We have many absentee owners, so issuing proper notice to the proper addresses is critical. Does the Privacy Act overrule the Strata Act?

— G.G., Coquitlam

Dear G.G.: The B.C. Personal Information Protection Act does not override the operational requirements of the Strata Property Act, as long as personal information of the owners, tenants and occupants that is collected by the strata is not compromised.

The Information Act does not override the section of the Strata Act regarding the mailing obligations for notice of meetings.

PIPA is very important, however, in how it relates to the collection of personal information.

That might include phone numbers, banking or credit card information, emergency contact information and strata lot insurance particulars, but it does NOT apply to contact information.

PIPA gives owners and tenants some control over their personal information by imposing rules on the collection, use and disclosure information.

Consent to collect personal information may be implied. For example, a person pays a strata fee by cheque. By providing the cheque, they have consented to the collection of that information, but not the disclosure of that information beyond the strata requirements.

Consent might also be specific. A person may consent in writing to a strata corporation collecting emergency contact information, or personal health information that might be valuable.

Another example of the collection of personal information is an owner who has made an application for an exemption from rental bylaws on the basis of hardship. That might require the provision of personal financial or related information necessary to verify the hardship.

Under PIPA, if the strata uses an individual’s personal information to make a decision, it must keep that information for at least one year after the date of that decision.

– Tony Gioventu is executive director of the Condominium Home Owners’ Association. E-mail [email protected]. The association’s website is www.choa.bc.ca.

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Tony Gioventu
Province

Dear Condo Smarts: Our strata corporation adopted a bylaw two years ago that prohibits the display of signs for provincial and municipal elections, and prohibits access to our building for campaigning.

They have always said that the Federal Election Act did not apply to provincial or municipal elections. Now we’ve heard that the laws have changed, so what happens to our bylaw, and what happens if we don’t repeal it?

— NM, Vancouver

Dear N.M.: The provincial elections legislation was recently amended, and it now includes the applications to strata corporations as well as rental/tenancy buildings. The election act applies to a provincial general election, provincial byelection, provincial or local government referendum, and local government elections and byelections.

Section 228.1 concerns tenant and strata election advertising:

(1) A landlord or person acting on a landlord’s behalf must not prohibit a tenant from displaying election advertising posters on the premises to which the tenant’s tenancy agreement relates.

(2) A strata corporation or any agent of a strata corporation must not prohibit the owner or tenant of a strata unit from displaying election advertising posters on the premises of his or her unit.

(3) Despite subsections (1) and (2), a landlord, a person, a strata corporation or an agent referred to in that subsection may:

a) set reasonable conditions relating to the size or type of election advertising posters that may be displayed on the premises, and

b) prohibit the display of election advertising posters in common areas of the building in which the premises are found.

The election act is silent on the topic of right of access to properties for election purposes; however, there is an applicable provision within the residential tenancy act that allows for political campaign access to residential rental properties.

The strata act stipulates that a bylaw that does not comply with any enactment of law is unenforceable. This is a perfect example of why strata corporations must maintain a current complete set of all bylaw amendments that are in force, and review them every year.

Laws change, conditions on properties change, and it’s easy to add one or two housekeeping amendments to your AGM to stay current.

If you have any questions regarding the election act and how it affects strata corporations, you can call Elections B.C. at 1-800-661-8683.

Tony Gioventu is executive director of the Condominium Home Owners Association. E-mail: [email protected].

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Tony Gioventu
Province

Dear Condo Smarts: We live on the upper part of Vancouver Island.

Our townhouse strata was informed by a new owner about a leak in their living room. The council inspected the home to discover that the previous owner back in January had removed the gas fireplace and installed a wood-burning stove and modified the existing windows. Water was clearly getting in around these areas.

We have hired a contractor who is returning the construction to the original, and we have instructed him to remove the wood-burning stove.

The new owner is furious because she intended to heat her unit with wood, not realizing she is already paying for gas heat as part of her strata fees.

Even the real-estate agent knew about the changes and didn’t say anything.

When do owners have to seek written permission of council before they make changes to a strata lot?

— M.J., Campbell River

Dear M.J.: Both the Standard Bylaws and your Strata Bylaw Amendments likely have all the direction you need to enforce these bylaws.

If you look closely at the Standard Bylaws under “alterations to a strata lot,” it says the owner needs written approval to alter a strata lot for the structure, the exterior, up to and including those parts of the strata lot that the strata corporation must insure under the act.

Here’s the big surprise for all strata owners. Fixtures and assets are items that must be insured, and that would include the original gas fireplace, and the original carpets, flooring, plumbing and electrical, and cabinets.

It might seem silly for the strata to have to approve an owner replacing their carpets, but don’t forget, if you upgrade or make betterments, the strata is no longer insuring those improvements.

When an owner makes alterations that are not approved — and in this case it would include the exterior of the building — the strata may do whatever is reasonably necessary to remedy the contravention.

This could mean restoring the damages to the original at the owners’ cost.

The new owner needs to contact a lawyer once she is aware of the costs, and consider a claim against the previous owner and the agent, who did not advise the purchaser of the unapproved alterations.

There are also serious fire-safety concerns and health concerns, including ventilation, about this conversion.

Was the gas connection terminated properly? Were any permits obtained? Is the venting susceptible to fire and the correct rating for this use?

The owner and the strata corporation also need to contact the local building inspector. An order may be issued by the local office to remove the installation, or a set of conditions may be issued for the requirement of upgrades and a permit, if the strata agrees to the alteration.

Whenever a strata discovers such a significant risk, it also now has a material defect that it is obliged to disclose to its insurance provider.

I’ve seen similar alterations where gas lines have been spliced to add a gas stove to a kitchen without permits or any consideration for safety. This alteration could affect the status of your insurance or your costs.

If you are aware of the risk and do not disclose or remedy it, and there is a fire, your strata could be faced with little or no insurance coverage.

Tony Gioventu is executive director of the Condominium Home Owners’ Association. E-mail him at [email protected]. The association’s website is www.choa.bc.ca.

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Here’s what you do to find out if they’re safe

Tony Gioventu
Province

Dear Condo Smarts: When our strata hired a new strata management company last year, we were told by the manager at our first meeting that it was best for the company to hold our trust funds because they were insured and bonded for the trust funds.

Based on the information we received and the fact that the company was licensed, we decided it was the best course of action. Now our management company has moved bank accounts and our trust funds without our knowledge or permission, and refused to tell us what banking institution our funds are being held in.

We are deeply concerned about the security of our funds, how they are being handled and what is being collected from owners, as we have received several complaints about double-dipping of monthly strata fees.

Where can we file a complaint regarding this company and how do we know if our funds are safe?

— D.V., Surrey.

Dear D.V.: The safe management and disclosure of strata trust funds is one of the most critical issues a strata council will have to address.

If a managing broker holds your operating, reserve or special levy funds, they must be held in a separate trust in your strata name: “In trust for the owners, strata plan (ABC1234).”

The location of those funds must be disclosed and the managing broker must provide to the strata corporation the actual monthly bank and investment statements of those accounts.

Those balances and expenses should then be cross-referenced each month by your treasurer and approved by the strata council as part of your financial process. If the information is not being disclosed as required by the real estate services act, regulations and rules of the Real Estate Council, you have a serious problem.

Request the documents from your broker. If they are not provided on request, the next step for your strata council is a complaint to the Real Estate Council. Ask to speak with a compliance officer at 604-683-9664.

There is a significant other issue here that every strata corporation should be aware of. Under the rules of the council, the duty of a brokerage is to disclose material information that may affect your contractual relationship with that party or may have an impact on your decision process.

For example, to state “the funds are insured” in itself is not sufficient and may be misleading.

Trust funds held by a brokerage have limited coverage under the compensation fund.

The brokerages are covered for a maximum of $350,000 per brokerage, and $100,000 per claimant. If several strata corporations were included in the same brokerage where there is a loss, then it’s only a share of a total of $350,000.

If a brokerage were to suffer a theft or fraud of funds, at best your strata corporation funds would only be covered for $100,000. (By comparison, funds held by your lawyer for special levies, are covered to a maximum of $300,000 per claimant, under the Law Society Trust protection.)

Whether you are self-managed or hire a brokerage, request backup documentation, review your bank statements every month, and scrutinize your financial statements on all accounts and investments.

Tony Gioventu
Province

Dear Condo Smarts: Our strata council received proposals from five management companies for service to our strata corporation. With the proposals, we received schedules of the work the companies will do, the costs and representation they will undertake. We have decided on a company and they have sent us a contract for signing.

However, there are a number of issues in the contract that make us uneasy. The manager said we cannot alter the contract as it is a standard contract.

There is a clause that requires us to defend the management company if it is sued, none of the work they claimed they would do in the presentation is listed in the contract, and we have no control over our funds. Is this normal? I can’t believe that we are forced to sign an agreement that cannot be changed. This seems unfair to the strata corporation.

— DP, Abbotsford

Dear DP: There is no standard agreement. As in any contractual agreement, it is a negotiation between two parties. You can make as many changes as you want, provided the other party agrees. The only requirement to the service agreement (contract) is that it complies with Section 5.1 of the Rules of the Real Estate Council.

This contract represents an agency agreement, where the management company acts on the direction of the strata corporation. Because a management company’s actions can incur liability for your strata corporation as well, it is prudent to include the management company on your liability insurance policy.

You may also negotiate under the contract to defend the manager in the event they are sued when acting as your agent; however, this can be limited to circumstances where they have acted in a manner that is not contrary to your bylaws, the Strata Property Act, Real Estate Services Act or any other enactment of law.

The strata corporation can still choose to maintain its own operating funds, reserve funds or special levies in their trust, but there are accounting and reporting limitations that may not be acceptable in the service agreement.

According to Cora Wilson, a Nanaimo lawyer who focuses her practice on strata law, every strata is encouraged to seek legal advice before they sign.

“Many contracts have hidden pitfalls that benefit only the managing broker, and the strata is left with little recourse,”says Wilson. “The contract should stipulate the actual services the company is providing. If the company chooses to sell its book of clients, will the strata have the final say in who handles their accounts next? If you want to terminate the agreement, what type of conditions exist in the contract?”

Contract your lawyer and review before you sign.

Tony Gioventu is executive director of the Condominium Home Owners’ Association. Send questions to him at [email protected]

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Tony Gioventu
Province

Dear Condo Smarts: I took our strata corporation policy to the company that provides our homeowner insurance. The broker told me that it was irrelevant, returned it to me and processed our annual renewal.

Well, our new washing machine flooded our home and two others just before Christmas.

The strata insurance paid the claim, but we have a $10,000 water deductible. Our insurance covered only $2,500 of the claim and we’re left paying the rest. What was the point of bringing in our strata policy if the broker never bothered to review our deductibles and adjust our insurance accordingly?

The broker claims there was no additional coverage available.

We want everyone to know that, when they buy homeowner insurance for a condo, you should read the strata policy and ask your broker for specific coverage for the water deductible, before you are crushed with a major bill.

— CM, Saanich

Dear CM: Depending on your insurance provider, there is additional insurance available to cover the higher values of insurance deductibles that a strata unit may be facing.

When homeowners, tenants or landlords purchase insurance, the only way to ensure they can protect themselves is to deal with an insurance company that is experienced with condominium homeowner policies.

You should send or bring a written notice to your agent/broker, including the strata binder cover that shows the deductible amounts for your strata corporation and what your expectations for coverage will be.

If an agent misrepresented the information or disclosure of the coverage, you may have grounds to sue the brokerage.

Consumers can also file a complaint with the Insurance Council of B.C. (www.insurancecouncilofbc.com).

Many strata owners and strata corporations are still sadly underinsured or improperly insured. If your strata is operating any type of commercial ventures, mixed-use properties, suite rentals, public facilities or sub-lease facilities, confirm those activities are covered on your policies.

Unit owners also need to understand that there are limitations of coverage to your unit if the occupancy changes.

Insurance policies are different for resident owners, tenants, landlords, short-term vacation rentals and commercial strata lots. Confirm that your strata unit use is clearly identified on the policy, that you have confirmed the deductible amounts of the strata policy and that you are satisfied with the coverages.

There are significant differences in coverage from company to company, so take the time to read the fine print and understand the exemptions.

Tony Gioventu is executive director of the Condominium Home Owners’ Association. Send questions to him at [email protected].

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TONY GIOVENTU
Province

Dear Condo Smarts: Our strata council has been receiving inquiries from our owners asking if they will be able to qualify for the new federal home reno tax credit. Will strata corporations qualify? If so, would it apply to each unit or does the strata corporation have to file returns? How are owners supposed to know how much they will be able to qualify for?

There is good news for resident strata homeowners. In the case of condominiums (strata property in B.C.) and co-operative housing corporations, the individuals who share the cost of eligible expenditures for common areas will qualify. The credit will be based on expenses for work performed or goods acquired after Jan. 27, 2009, and before Feb. 1, 2010.

Eligibility for the tax credit will be family-based, and a single credit per family may be shared within the family. Eligible expenditures need to be incurred in relation to a renovation or alteration to an eligible dwelling or related land f o r m i n g p a rt of the dwelling. It includes the cost of labour, professional services, building materials, fixtures, rentals and permits.

Your strata must maintain and retain copies of agreements, invoices and receipts that clearly identify the type and quantity of goods purchased or services provided.

There are some practical implications for strata corporations and strata managers. It will require the strata corporation to produce a financial statement of the types of expenses that will qualify, and the strata will likely be required to issue to each owner at the end of the period on Feb. 1, 2010, a statement showing the total costs, and the share of each unit based on unit entitlement.
Owners do not have to submit supporting documents with their tax returns, but they must be available should they be requested by the CRA.

It will be critical that your strata corporation tracks the eligible expenses this year and maintains all of the related records.

Eligible repairs include kitchen, bathroom or basement renovations, new flooring, new additions, decks or fences, a new furnace, a new driveway or painting of the interior or exterior of your homes.

For more info go to www.budget.gc.ca/2009 or www.cra-arc.gc.ca

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