Copyright 2016 by the UBC Real Estate Division

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1 DISCLAIMER: This publication is intended for EDUCATIONAL purposes only. The information contained herein is subject to change with no notice, and while a great deal of care has been taken to provide accurate and current information, UBC, their affiliates, authors, editors and staff (collectively, the "UBC Group") makes no claims, representations, or warranties as to accuracy, completeness, usefulness or adequacy of any of the information contained herein. Under no circumstances shall the UBC Group be liable for any losses or damages whatsoever, whether in contract, tort or otherwise, from the use of, or reliance on, the information contained herein. Further, the general principles and conclusions presented in this text are subject to local, provincial, and federal laws and regulations, court cases, and any revisions of the same. This publication is sold for educational purposes only and is not intended to provide, and does not constitute, legal, accounting, or other professional advice. Professional advice should be consulted regarding every specific circumstance before acting on the information presented in these materials. Copyright: 2016 by the UBC Real Estate Division, Sauder School of Business, The University of British Columbia. Printed in Canada. ALL RIGHTS RESERVED. No part of this work covered by the copyright hereon may be reproduced, transcribed, modified, distributed, republished, or used in any form or by any means graphic, electronic, or mechanical, including photocopying, recording, taping, web distribution, or used in any information storage and retrieval system without the prior written permission of the publisher.

2 CHAPTER 13 OVERVIEW OF THE STRATA PROPERTY ACT AND REGULATION Learning Objectives After studying this chapter, a student should be able to: Be familiar with the basic structure and content of the Strata Property Act Identify those provisions of the Strata Property Act and the Strata Property Regulation which are of practical importance for strata managers

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4 Chapter 13 Overview of the Strata Property Act and Regulation 13.1 INTRODUCTION As the governing legislation dealing with strata properties, strata managers must be intimately familiar with the requirements of the Strata Property Act (the Act ) and the Strata Property Regulation, BC Reg. 43/2000 (the Regulation ). Many of those provisions were addressed in Chapter 12 of this text or in other course materials. However, this chapter is intended to provide an overview of the structure and content of the Act, with particular emphasis on those sections of particular importance to strata managers. This chapter will also elaborate on some of the Parts of the Act that may not be addressed elsewhere in the course. Where appropriate, the statutory provision(s) is followed by a brief description of processes and/or legal principles that are important to strata managers. As with previous chapters, students are not expected to memorize the section numbers to the Act or Regulation, but should rather concentrate on the provisions themselves. For reference, you may access the Act and Regulation through the links provided on your Course Resources webpage. THE STRATA PROPERTY ACT AND STRATA PROPERTY REGULATION The Act provides a framework of rights and responsibilities for those living in strata developments. The Act is divided into a number of Parts, each dealing with a separate issue. For instance, separate Parts of the Act deal with the establishment of the strata corporation (Part 2); governance of the strata (Part 4); insurance matters (Part 9) and the cancellation of the strata plan and winding up of the strata corporation (Part 16). SPECIFIC PROVISIONS UNDER THE STRATA PROPERTY ACT The various Parts of the Act are listed below: Part 1 Definitions and Interpretation Part 2 The Strata Corporation Part 3 The Owner Developer Part 4 Strata Corporation Governance Part 5 Property Part 6 Finances Part 7 Bylaws and Rules Part 8 Rentals Part 9 Insurance Part 10 Legal Proceedings and Arbitration Part 11 Sections Part 12 Leasehold Strata Plans Part 13 Phased Strata Plans Part 14 Land Titles Part 15 Strata Plan Amendment and Amalgamation Part 16 Cancellation of Strata Plan and Winding Up of Strata Corporation Part 17 General Schedule of Standard Bylaws The Schedule of Standard Bylaws that appears after Part 17 are the bylaws that govern each strata property, unless different bylaws have been filed in the land title office. Different bylaws may be filed at the land title office by the owner developer at the time the owner developer files the strata plan. The owners may also file different bylaws at the land title office by following the procedure set out in section 128 of the Act. In either case the different bylaws may take the form of amendments to the wording of the Standard Bylaws, maintaining the Standard Bylaws and adding new bylaws, or the filing may replace the Standard Bylaws with a comprehensive bylaw package. The discussion under Part 7 contains more information on bylaw amendments. Bylaw amendment filings are listed on the Strata Plan General Index maintained for each strata corporation by the land title office. The Strata Plan General Index may be obtained from BC Online. The following sections deal with the specific Parts of the Act and itemize provisions related to strata management services.

5 13.2 Strata Management Licensing Course Manual Part 1 (section 1) Definitions and Interpretations Part 1 of the Act contains the definitions of the key terms used in the Act. The following definitions will be of particular interest to strata managers: common asset means (a) personal property held by or on behalf of a strata corporation, and (b) land held in the name of or on behalf of a strata corporation, that is (i) not shown on the strata plan, or (ii) shown as a strata lot on the strata plan. Note that common assets include such things as a lawnmower (i.e., personal property) and a caretaker s suite (i.e., land or real property). Pursuant to section 29 of the Interpretation Act (RSBC 1996, c 238), land includes an interest in land, including any right, title or estate in it of any tenure. Therefore, common assets will include easements and similar interests in favour of a strata corporation. common expenses means expenses (a) relating to the common property and common assets of the strata corporation, or (b) required to meet any other purpose or obligation of the strata corporation. Note that the satisfaction of a judgment against a strata corporation is an example of an expense required to meet an obligation of the strata corporation. common property means (a) that part of the land and buildings shown on a strata plan that is not part of a strata lot, and (b) pipes, wires, cables, chutes, ducts and other facilities for the passage or provision of water, sewage, drainage, gas, oil, electricity, telephone, radio, television, garbage, heating and cooling systems, or other similar services, if they are located (i) within a floor, wall or ceiling that forms a boundary (1) between a strata lot and another strata lot, (2) between a strata lot and the common property, or (3) between a strata lot or common property and another parcel of land, or (ii) wholly or partially within a strata lot, if they are capable of being and intended to be used in connection with the enjoyment of another strata lot or the common property. The concept of common property was first introduced to you in Chapters 5 and 12. Note that section 68 in Part 5 of the Act defines the boundaries of a strata lot as being midway between the surfaces of the structural portion of a wall. If the boundary is midway, an issue arises concerning building components such as windows, doors, or skylights, which may or may not fall on one side or the other of the boundary line. The definition of common property does not expressly include windows, doors and skylights on the exterior of a building. If a window, door, or skylight does straddle the boundary line or, if the strata plan is unclear as to where it sits, the BC courts, in Kearsley v. Strata Plan KAS 1215, 2008 BCSC 1606, have interpreted section 68 as giving both of the parties sharing the boundary an ownership interest in the component. This means that, in some circumstances, in principle, the owners may be at least partly responsible for repair and maintenance of not only windows, doors, and skylights, but also structural walls, since owners notionally own such walls to the midway point. However, relying on section 72(3) of the Act, the Schedule of Standard Bylaws at sections 8(c) and 8(d) resolves this issue by allocating responsibility for these building parts to the strata corporation as being limited common property or common property or as being part of the strata lot. In most circumstances, the building exteriors, except for a bare land strata, are common property and the responsibility of the strata corporation to maintain and repair. Before amending bylaws or determining who is responsible for maintenance and repair of building exteriors including doors, windows, decks/balconies or roofing systems, the strata corporation should verify the location and designation of the property. Since windows and doors do not appear on a strata plan, it will be necessary to conduct a visual inspection of the property in order to determine whether the window or door is part of the strata lot, common property or whether the window or door straddles the boundary in which case the ownership would be shared.. The strata corporation is not permitted by the Act or Regulation to make an owner responsible for the maintenance and repair of common property and common assets. Before the strata corporation contemplates amending bylaws that affect the maintenance and repair of building exterior components, the strata corporation should seek legal advice.

6 Chapter 13 Overview of the Strata Property Act and Regulation 13.3 limited common property means common property designated for the exclusive use of the owners of one or more strata lots. The courts in British Columbia have held that limited common property is a special category of property over which an owner has a substantial degree of control and something approaching a beneficial interest (see Moore v. Strata Plan NW 2099, 2003 BCSC 1364). While limited common property is ordinarily exclusively used by one owner, such property is still common property. Accordingly, a strata corporation can still pass bylaws under section 119 of the Act regulating its use (e.g., the types of objects that are allowed to be placed on balconies is commonly restricted by bylaw). Further, the strata corporation may be held civilly liable for any injuries that occur on limited common property. In Cater v. Ghag Enterprises. Ltd., 1991 CanLII 2275, the court found that the strata corporation and the individual owner were equally liable in negligence for injuries suffered by a child as a result of crashing his bike into a pothole in a driveway that was deemed to be limited common property. sue means the act of bringing any kind of court proceeding. Whether the legal proceedings can be brought in Provincial Court (Small Claims Court) or the BC Supreme Court will depend on the nature of the dispute. In Armanowski v The Owners, Strata Plan LMS 2151, 2011 BCPC 271 the Court held that not all disputes between unit owners and their strata corporation must be heard in the Supreme Court of British Columbia. It depends upon the nature of the unit owner s claim and whether it falls within the scope of Section of the Strata Property Act. The Court in Armanowski adopted the reasoning in Valana v. Law, 2005 BCPC 587, which held that causes of action falling outside the lawsuits contemplated by sections 164 and 165 of the Act, such as claims in tort or contract, could be pursued in the Provincial Court or the BC Supreme Court, subject to the monetary limitations of the Provincial Court. Owners have successfully sued their strata corporation in Provincial Court for damages for failure to repair common property. (See Fudge v. The Owners Strata Plan NW 2636, 2012 BCPC 409; Paul v. Riding and The Owners Strata Plan NW 612, 2013 BCPC 292.) Chapter 12 of this Manual contains more detailed information on legal proceedings involving strata corporations. Furthermore, Chapter 27 of The Condominium Manual: A Comprehensive Guide to Strata Law in British Columbia, which is included in your course materials, contains further information regarding lawsuits conducted by or against the strata corporation. unanimous vote means a vote in favour of a resolution by all the votes of all the eligible voters. The definition of unanimous vote requires every voter within the strata corporation and not just those voters in attendance at the meeting to vote in favour of the resolution. The voters can attend in person or by proxy; however, if even one owner does not attend or submit a proxy, the unanimous vote cannot pass. Part 2 (sections 2-4) The Strata Corporation Part 2 of the Act deals with the establishment and responsibilities of a strata corporation and provides that the powers and duties of the strata corporation must be exercised and performed by a council, unless the Act, the Regulation or the bylaws provide otherwise. Part 3 (sections 5-24) The Owner Developer Part 3 of the Act deals with the duties and responsibilities of the owner developer, from the outset of the development of the strata corporation up to and immediately following the first conveyance of strata lots. Some notable sections follow: First annual budget requirements 21. (1) The first annual budget must be for the 12 month period beginning on the first day of the month following the date of the first annual general meeting. (2) The first annual budget must be distributed with the notice of the first annual general meeting under section 45 and must be accompanied by a financial statement. (3) The budget and financial statement (a) must contain the information required by the regulations, and (b) may be in the form set out in the regulations. (4) Approval of the first annual budget must be by a resolution passed by a majority vote.

7 13.4 Strata Management Licensing Course Manual (5) The proposed budget may be amended by a majority vote at the first annual general meeting before the budget itself is put to a vote. (6) Within 8 weeks after the first annual general meeting, the owner developer must give the strata corporation a financial statement updated to (a) the date the first annual budget takes effect, or (b) if no budget is approved at the first annual general meeting, the date of the first annual general meeting. The provisions of sections 3.3 and 6.6 of the Regulation are also applicable to the Act s budget requirements provisions. Together they require that the first annual budget must contain the following information (listed in Regulation 6.6): (a) the opening balance in the operating fund and the contingency reserve fund; (b) the estimated income from all sources other than strata fees, itemized by source; (c) the estimated expenditures out of the operating fund, itemized by category of expenditure; (d) the total of all contributions to the operating fund; (e) the total of all contributions to the contingency reserve fund; (f ) each strata lot s monthly contribution to the operating fund; (g) each strata lot s monthly contribution to the contingency reserve fund; (h) the estimated balance in the operating fund at the end of the fiscal year; and (i) the estimated balance in the contingency reserve fund at the end of the fiscal year. In addition, the financial statement must contain the following information listed in Regulation 3.3: (a) the details of the strata corporation s income from all sources from the first day of the period covered by the interim budget until a day that is within the 6 week period before the date of the first annual general meeting; (b) the details of expenditures out of the operating fund for the period referred to in paragraph (a); (c) the details of any expenditures or accrued expenses not included in the operating expenses estimated in the interim budget; and (d) the amount in the contingency reserve fund on the first and last day of the period referred to in paragraph (a). Part 4 (sections 25-65) Strata Corporation Governance Part 4 of the Act contains a number of Divisions, with each dealing with a different aspect of the governance of the strata corporation. Several provisions which are of particular importance to strata managers are listed below. Division 1 of Part 4 focuses on the strata council, from eligibility and election of council members, to disclosure and accountability rules, to remuneration. Contracts not invalidated 30. (1) The validity of a contract made or a certificate issued by the strata corporation is not affected by (a) a defect in the appointment or election of the council member or officer who makes the contract or signs the certificate on behalf of the strata corporation, or (b) a limitation on the authority of the council member or officer to act on behalf of the strata corporation. (2) A person who knew or ought reasonably to have known of the defect or limitation at the time the person made a contract with or received a certificate from the strata corporation may not rely on subsection (1) to bind the strata corporation with respect to the contract or certificate. Council member s standard of care 31. In exercising the powers and performing the duties of the strata corporation, each council member must (a) act honestly and in good faith with a view to the best interests of the strata corporation and (b) exercise the care, diligence and skill of a reasonably prudent person in comparable circumstances.

8 Chapter 13 Overview of the Strata Property Act and Regulation 13.5 The BC courts have held that the applicable standard of care is one of reasonableness, not strict or absolute liability. The duty is to act fairly. Good faith has been held to describe...that state of mind denoting honesty of purpose, freedom from intention to defraud, and...being faithful to one s duty or obligation. The statutory standard of care under section 31 of the Act is equivalent to the duty imposed on directors and officers under section 142 of the Business Corporations Act. However, the statutory duty of care may be judged to be higher for council members who are elected specifically for their professional expertise, especially if they are paid for their services under section 34 of the Act. absolute liability a standard of liability under which legal responsibility is imposed on the wrongdoer regardless of whether or not the wrongdoer s act was reasonable Division 2 of Part 4 sets out the law regarding the creation, retention and issuance of strata corporation records. The provisions of sections 35, 36, and 37 of the Act are mandatory and generally fall within the duties of the strata manager. Refer also to Chapter 13 of The Condominium Manual. Strata corporation records 35. (1) The strata corporation must prepare all of the following records: (a) minutes of annual and special general meetings and council meetings, including the results of any votes; (b) a list of council members; (c) a list of (i) owners, with their strata lot addresses, mailing addresses if different, strata lot numbers as shown on the strata plan, parking stall numbers, if any, and unit entitlements, (ii) names and addresses of mortgagees who have filed a Mortgagee s Request for Notification under section 60, (iii) names of tenants, and (iv) assignments of voting or other rights by landlords to tenants under sections 147 and 148; (d) books of account showing money received and spent and the reason for the receipt or expenditure; (e) any other records required by the regulations. (2) The strata corporation must retain copies of all of the following: (a) the records referred to in subsection (1); (b) the registered strata plan and any strata plan amendments as obtained from the land title office; (c) this Act and the regulations; (d) the bylaws and rules; (e) resolutions that deal with changes to common property, including the designation of limited common property; (f ) waivers and consents under section 41, 44 or 45; (g) written contracts to which the strata corporation is a party; (h) any decision of an arbitrator or judge in a proceeding in which the strata corporation was a party, and any legal opinions obtained by the strata corporation; (i) the budget and financial statement for the current year and for previous years; (j) income tax returns, if any; (k) correspondence sent or received by the strata corporation and council; (l) bank statements, cancelled cheques and certificates of deposit; (m) Information Certificates issued under section 59; (n) the records and documents referred to in section 20 or 23 obtained by the strata corporation; (o) any other records required by the regulations. Section 35(3) provides that the records referred to in section 35 must be retained by the strata corporation for the periods set out in the regulations, and these time periods are contained in Regulation 4.1. Regulation 4.1(1) requires that, in addition to the records required to be prepared and kept under section 35 of the Act, the strata corporation also must prepare a record of each council member s telephone number or some other

9 13.6 Strata Management Licensing Course Manual method by which the council member may be contacted at short notice, as long as that method is not prohibited by the bylaws. Regulation 4.1(2) - (7) set out the applicable retention periods: 4.1 (2) The strata corporation must permanently retain the records and documents referred to in section 35 (2) (b), (e) and (h) of the Act. (3) The strata corporation must retain the records and documents referred to in section 35 (1) (a) and (d) and 35 (2) (f ), (i), (j), (l) and (m) of the Act for at least 6 years. (4) The strata corporation must retain the written contracts, including insurance policies, referred to in section 35 (2) (g) of the Act, for at least 6 years after the termination or expiration of the contract or policy. (5) The strata corporation must retain the correspondence referred to in section 35 (2) (k) of the Act for at least 2 years. (6) The strata corporation must retain current copies of the records and documents referred to in section 35 (1) (b) and (c) and 35 (2) (c) and (d) of the Act and subsection (1) of this section. (7) The strata corporation must retain the following records and documents referred to in section 35 (2) (n) of the Act and obtained from the owner developer under sections 20 and 23 of the Act for the following periods: (a) the records and documents referred to in section 20 (2) (a) (i), (ii), (iv), (v) and (vi) of the Act must be permanently retained; (b) the contracts, including insurance policies, referred to in section 20 (2) (a) (iii) of the Act must be retained for at least 6 years after the termination or expiration of the contract or policy; (c) the records and documents, other than warranties, referred to in section 20 (2) (a) (vii) of the Act, must be retained until the disposal or replacement of the common property or common asset to which they relate; (d) the warranties referred to in section 20 (2) (a) (vii) of the Act must be retained until the disposal or replacement of the common property or common asset to which they relate, or the expiration of the warranty coverage, whichever comes first; (e) the financial records obtained under section 23 of the Act, if any, must be retained for at least 6 years after the transfer of control referred to in section 22 of the Act. Access to records 36. (1) On receiving a request, the strata corporation must make the records and documents referred to in section 35 available for inspection by, and provide copies of them to, (a) an owner, (b) a tenant who, under section 147 or 148, has been assigned a landlord s right to inspect and obtain copies of records and documents, or (c) a person authorized in writing by an owner or tenant referred to in paragraph (a) or (b). (1.1) On receiving a request from a former owner, from a former tenant referred to in subsection (1)(b) or from a person authorized in writing by the former owner or former tenant, the strata corporation must, with respect to records and documents referred to in section 35 that, whenever created, relate to the period during which the former owner or former tenant was an owner or tenant, make those records and documents available for inspection by, and provide copies of them to, the former owner, former tenant or person authorized in writing, as the case may be. (2) On receiving the request of a tenant, or a person authorized in writing by a tenant, the strata corporation must (a) make the bylaws and rules available for inspection, and (b) provide copies of the bylaws and rules. (3) The strata corporation must comply with a request under subsection (1), (1.1) or (2) within 2 weeks unless the request is in respect of bylaws or rules, in which case the strata corporation must comply with the request within one week. (4) The strata corporation may charge a fee for a copy of a record or document provided under this section of not more than the amount set out in the regulations and may refuse to supply the copy until the fee is paid.

10 Chapter 13 Overview of the Strata Property Act and Regulation 13.7 However, it should be noted that section 169(1)(b) of the Act limits the strata corporation s obligation to provide certain records to an owner if that owner is involved in a lawsuit with the strata corporation. When providing strata corporation records and documents to an owner or tenant, the strata corporation must be alert to matters of privacy. The Personal Information Protection Act applies to strata corporations and may impact the personal information that can be released. A detailed discussion of the Personal Information Protection Act is found in Chapter 6. Information on collecting and releasing personal information can be found in the Privacy Guidelines for Strata Corporations and Strata Agents dated January 2011 prepared by the Office of the Information & Privacy Commissioner for British Columbia. Regulation 4.2 provides that no fee may be charged to an owner, a tenant or a person authorized by an owner or tenant for the inspection of a record or document under section 36 of the Act, and it sets the maximum fee that the strata corporation may charge for a copy of a record or document provided under section 36 of the Act at 25 cents per page. Strata manager to return records 37. (1) If a strata management contract ends, the person providing the strata management services must, within 4 weeks, give the strata corporation any records referred to in section 35 that are in the person s possession or control. (2) A person who fails to comply with subsection (1) must pay to the strata corporation an amount calculated according to the regulations. Note that section 37 of the Act is mandatory, and Regulation 4.3 sets the penalty for failure to comply with section 37 at $1,000. Also remember that section 8-7.1(5) of the Council Rules under the Real Estate Services Act reiterates the requirements of section 37. Division 3 of Part 4 contains the provisions relating to contracts entered into on behalf of the strata corporation, including those with respect to strata property management contracts, and in reading these sections you may want to refer also to Chapter 8 (The Law of Contract), Chapter 9 (Strata Management Contracts) and Chapter 25 (Purchasing) of this Manual. Cancellation of strata management contracts 39. (1) A contract entered into by or on behalf of the strata corporation for the provision of strata management services to the strata corporation may be cancelled, without liability or penalty, despite any provision of the contract to the contrary, (a) by the strata corporation on 2 months notice if the cancellation is first approved by a resolution passed by a ¾ vote at an annual or special general meeting, or (b) by the other party to the contract on 2 months notice. (2) The strata corporation does not need any prior approval to cancel the contract in accordance with its terms or to refuse to renew the contract when it expires. As mentioned in Chapter 9, although section 39 sets out cancellation provisions that will apply despite the provisions of the contract, section 39 also permits a strata management contract to be cancelled in accordance with its terms. These two sections permit a strata management contract to contain termination provisions that are less onerous than the provisions set out in section 39. For example, the contract may permit the strata council to cancel the contract, or alternatively the contract could permit the owners to terminate the contract by majority vote. The strata management company and the strata council could negotiate a termination provision that is acceptable to both parties as long as it does not impose requirements that are more onerous than those set out in section 39 of the Act. As a Strata Manager... Because a strata management contract may contain termination provisions that are different from those set out in section 39 of the Act, when a strata corporation terminates or expresses an interest in terminating the management contract, you must be careful to review the specific terms of the strata corporation s contract to determine what termination provisions exist. You should not assume that the only way a contract can be terminated is in accordance with section 39 of the Act.

11 13.8 Strata Management Licensing Course Manual Division 4 of Part 4 contains those provisions regulating the conduct of annual general meetings and special general meetings and the notice provisions with respect thereto. Students should pay particular attention to these provisions as the strata council will typically rely upon the strata manager for advice and direction with respect to the calling of such meetings, the provision of notice, and the voting and retention of records. Chapters 15 and 16 of this Manual contain detailed materials regarding the provisions of Division 4 of Part 4 and other aspects of meetings. Annual general meeting 40. (1) The strata corporation must hold annual general meetings except as provided under section 41. (2) An annual general meeting must be held no later than 2 months after the strata corporation s fiscal year end. One of the primary responsibilities of the strata manager is to prepare for and organize the general meetings of owners. The strata manager is the person upon whom the strata council and the developer rely for guidance with respect to the requirements of the Act and for practical advice relating to the planning and scheduling of the meeting and the meeting procedures. The importance of compliance with the Act cannot be overstated, since, in some cases, the Courts have found resolutions, which were approved at a general meeting, to be void where the requirements of the Act were not followed. Additionally, the strata manager is expected to prepare for the meeting and often, to advise the chair of the meeting, (usually the president of the strata council) on meeting procedure. The strata manager must possess strong organizational skills in order to deal with the significant amount of paper and information that is required for each meeting. Chapter 16 explores the idea of meeting governance in greater detail. Strata managers must pay close attention to the date by which the first AGM must be called. Section 16 of the Act states that the owner developer must hold the first AGM during the 6 week period that begins on the earlier of (i) the date on which 50% plus one of the strata lots have been conveyed to purchasers, and (ii) the date that is 9 months after the date of the first conveyance of a strata lot to a diarize to keep a written purchaser. Because of the significant penalties that developers face if they fail to call the meeting record of events within the time required, the strata manager may incur liability if he or she does not advise the developer about the need to call a meeting. The strata manager should diarize a date that is nine months after the date the first conveyance and receive regular sales updates from the developer. Because the meeting must be held on the earlier of the two possible dates, it is usually the case that the calling of the meeting will be triggered by the sale of 50% plus one of the strata lots which may occur a number of months before the nine month deadline occurs. Therefore, monitoring sales activity is very important in order to advise the owner developer of the need to call the meeting. After the first AGM, because the first budget establishes the fiscal year, the subsequent AGMs are usually held around the same time every year. The strata manager should diarize each strata corporation s fiscal year end, so that he or she can provide the strata council with sufficient notice to finalize the next year s budget, complete the financial statements and determine whether any ¾ or unanimous votes are necessary. If a ¾ or unanimous vote is necessary, sufficient time should be allowed to have the resolution drafted by legal counsel, if necessary. As a Strata Manager... Planning for a strata corporation s AGM may need to begin many months before the date the meeting is to be held. If the strata council intends to propose a special levy for a major repair project at the next AGM, it will be necessary to obtain instructions from the strata council to obtain quotations for the work and possibly legal assistance with the drafting of the special levy resolution. This could take a number of months. Alternatively, if the strata council is proposing to put forward bylaw amendments at the next annual general meeting, it may be necessary to form a bylaw committee, obtain owner input and have the proposed amendments drafted by or reviewed by legal counsel, which will take a considerable amount of time.

12 Chapter 13 Overview of the Strata Property Act and Regulation 13.9 Waiver of annual general meeting 41. (1) The strata corporation does not have to hold an annual general meeting if, before the last date by which the meeting must be held, all eligible voters waive, in writing, the holding of the meeting and consent, in writing, to resolutions that (a) approve the budget for the coming fiscal year, (b) elect a council by acclamation, and (c) deal with any other business. waive to voluntarily relinquish a right or privilege to which one is entitled (2) If 2 or more persons share one vote with respect to a strata lot, all of them must consent to the waiver of the meeting and to the resolutions under subsection (1). An SGM is any general meeting other than a mandatory AGM. Section 42 of the Act provides that the strata corporation may call a SGM at any time by giving proper notice. As well, section 43(1) of the Act allows any persons holding at least 20% of the strata corporation s votes to demand, in writing, that the strata corporation hold a SGM. Notice requirements for annual or special general meeting 45. (1) The strata corporation must give at least 2 weeks written notice of an annual or special general meeting to all of the following: (a) every owner, whether or not a notice must also be sent to the owner s mortgagee or tenant; (b) every mortgagee who has given the strata corporation a Mortgagee s Request for Notification under section 60; (c) every tenant who has been assigned a landlord s right to vote under section 147 or 148, if the strata corporation has received notice of the assignment. (2) A person who has a right to be notified under this section may, in writing, waive the right and may, in writing, revoke a waiver. (3) The notice of the annual or special general meeting must include a description of the matters that will be voted on at the meeting, including the proposed wording of any resolution requiring a ¾ vote or unanimous vote. (4) If the meeting is an annual general meeting, the notice must include the budget and financial statement referred to in section 103 (ie., for the coming fiscal year). (5) A vote at an annual or special general meeting may proceed despite the lack of notice as required by this section, if all persons entitled to receive notice waive, in writing, their right to notice. (6) If 2 or more persons share one vote with respect to a strata lot, all of them must consent to the waiver of notice under subsection (5). Regarding the calculation of time in section 45(1), section 25 of the Interpretation Act provides that, when calculating a time period expressed as at least a certain number of days, the first and last days must be excluded. Consequently, it would be prudent to deliver notices 20 days before any meeting in order to comply with both section 25 of the Interpretation Act and section 61(3) of the Act (discussed later in this chapter). Failure to give proper notice of an annual or special general meeting to a person entitled to receive notice under section 45 does not invalidate a vote taken at the meeting, as long as the strata corporation made a reasonable attempt to give the notice in accordance with that section (section 47). However, what is a reasonable attempt is open to interpretation. In the case of Fassas v. The Owners, Strata Plan VR 2566 (2002) unreported, the Judge refused to permit the strata corporation to rely on section 47. In Fassas, the strata manager had responded to communication from the owner regarding the rental of her unit by writing to the owner at the address on the incoming correspondence. However, the notice for the annual general meeting, which included a proposal to amend the rental bylaw, was sent to the strata lot as the strata management company s mailing list had not been updated to include Ms. Fassas address. Ms. Fassas applied to the court to have the meeting and resolution to amend the bylaws set aside on the basis that she did not receive notice of the meeting. Although the strata corporation argued that its attempts to notify all owners had been reasonable, the Judge disagreed and found that the strata corporation s had not made a reasonable attempt to give notice to the owners. The Judge held that the resolution approving the bylaws was void and of no effect.

13 13.10 Strata Management Licensing Course Manual However, the provisions of section 45(3) must be strictly complied with. That is, notice of a meeting where there will be a vote requiring a ¾ majority must clearly set out the purpose of the ¾ vote. Case law decided under the Act s predecessor legislation (the Condominium Act) indicates that section 45(3) precludes raising motions from the floor during a meeting, except as an amendment to a resolution under section 50(2). Note that meeting notice requirements are dealt with in greater detail in Chapter 15 (Strata Meetings and Communications). Quorum for annual or special general meeting 48. (1) Business must not be conducted at an annual or special general meeting unless a quorum is present. (2) Subject to the bylaws, a quorum for an annual or special general meeting is (a) eligible voters holding ⅓ of the strata corporation s votes, present in person or by proxy, or (b) if there are fewer than 4 strata lots or fewer than 4 owners, eligible voters holding 2/3 of the strata corporation s votes, present in person or by proxy. (3) Unless otherwise provided in the bylaws, if within ½ hour from the time appointed for an annual or special general meeting a quorum is not present, the meeting stands adjourned to the same day in the next week at the same place and time but, if on the day to which the meeting is adjourned a quorum described in subsection (2) is not present within ½ hour from the time appointed for the meeting, the eligible voters present in person or by proxy constitute a quorum. Note that the topic of quorums is also dealt with in greater detail in Chapter 15 (Strata Meetings and Communications). Division 5 of Part 4 contains those provisions regulating voting, proxies and related matters. Chapters 9 and 15 also contain information on these topics. Number of votes per strata lot 53. (1) At an annual or special general meeting each strata lot has one vote unless different voting rights are set out in a Schedule of Voting Rights in the prescribed form in accordance with section 247, 248 or 264. A strata plan that is wholly residential will have just one vote per strata lot and will not have a Schedule of Voting Rights if the strata plan was filed after July 1, 2000, which is the date the Act came into force. Strata plans filed prior to July 1, 2000 will include a voting schedule that may set out that each strata lot has one vote, or it may be blank. 53 (2) Despite subsection (1), a strata corporation may, by bylaw, provide that the vote for a strata lot may not be exercised, except on matters requiring a unanimous vote, if the strata corporation is entitled to register a lien against that strata lot under section 116(1). Section 53(2) permits a strata corporation to pass a bylaw prohibiting Schedule of Voting Rights voting if it is entitled to register a lien against a defaulting owner s a table that sets out the number of votes lot. The most common situations where a strata corporation is that each strata lot is entitled to exercise at a general meeting of the strata corporation entitled to register such a lien are when an owner has failed to pay strata fees or special levies. Case law has confirmed that to be entitled to register a lien against a strata lot, the strata corporation must have issued a demand for payment in accordance with section 112 of the Act. Pursuant to section 116(1) of the Act, fines, claims for insurance deductibles, and amounts assessed against the owner for repairs that did not arise from work ordered by a public authority pursuant to section 85 of the Act, cannot be included in liens. Consequently, a strata corporation cannot prohibit an owner who owes such amounts from voting. However, some strata corporations have approved bylaw amendments that prohibit an owner from voting if the owner owes any money to the strata corporation. As a Strata Manager... Before prohibiting an owner from voting, you should ensure that the strata corporation has a bylaw that prohibits an owner from voting if the strata corporation is permitted to file a lien and that the strata corporation has issued a demand for payment. The demand should give the owner at least 2 weeks notice to pay and specifically advise that a lien may be registered if payment is not received.

14 Chapter 13 Overview of the Strata Property Act and Regulation If the strata corporation s bylaws include a provision prohibiting owners from voting if the owner owes any money to the strata corporation, you should point out the provisions of section 116 of the Act to the strata council and recommend that the strata corporation seek legal advice. Voters 54. The following persons may vote at an annual or special general meeting: (a) an owner, unless a tenant or mortgagee has the right to vote under paragraph (b) or (c); (b) a tenant who has been assigned a landlord s right to vote under section 147 or 148, unless a mortgagee has the right to vote under paragraph (c); (c) a mortgagee of a strata lot, but only in respect of insurance, maintenance, finance or other matters affecting the security for the mortgage and only if (i) the mortgage gives the mortgagee the right to vote, and (ii) at least 3 days before the meeting the mortgagee has given to the strata corporation, the owner and the tenant referred to in paragraph (b), if any, written notice of the mortgagee s intention to vote. If the powers and duties of the owner have been assigned to a residential tenant under a long term lease (a lease to a person for a set term of 3 years or more) pursuant to section 148 of the Act, the owner may have no ability to assign voting rights to a mortgagee under section 54(c) of the Act. Special voters 55. (1) If a person who may vote under section 54 is under 16 years of age, the person s right to vote may be exercised only by the person s parent or guardian. (2) If a person who may vote under section 54 lacks the capacity to make a decision for a reason other than being under 16 years of age, the person s right to vote may be exercised only by someone who is legally authorized to act for the person with respect to the strata lot. Proxies 56. (1) A person who may vote under section 54 or 55 may vote in person or by proxy. (2) A document appointing a proxy (a) must be in writing and be signed by the person appointing the proxy, (b) may be either general or for a specific meeting or a specific resolution, and (c) may be revoked at any time. (3) The following persons may be proxies: (a) only if permitted by regulation and subject to prescribed restrictions, an employee of the strata corporation; (b) only if permitted by regulation and subject to prescribed restrictions, a person who provides strata management services to the strata corporation; (c) subject to the regulations, any other person. (4) A proxy stands in the place of the person appointing the proxy, and can do anything that person can do, including vote, propose and second motions and participate in the discussion, unless limited in the appointment document. As a Strata Manager... The proxy form is the property of the person holding the proxy. When registering individuals holding proxies, the registration process should confirm that the person holding the proxy is the person named in the proxy. If you or the strata council members do not know the person holding the proxy, they should be asked to produce identification. The proxy form should not be collected, but should be returned to the proxy holder. The proxy form may be for a period beyond the current meeting and/or it may contain instructions to the proxy holder. It is not necessary for you or the strata council to record or even review the instructions on the proxy form, as these instructions are between the owner and the proxy holder. Additionally, it may be that a secret ballot is requested on one or more of the resolutions on which the proxy holder has received instructions. If the instructions are recorded or reviewed, the owner could have an argument that the secrecy of the ballot was compromised.

15 13.12 Strata Management Licensing Course Manual The Act does not expressly permit voting by proxy at council meetings. Under the previous legislation, the courts found that voting by proxy at council meetings was not permitted because the Condominium Act did not expressly provide for voting by proxy at council meetings. Note that section 56(3) of the Act contemplates that, if expressly provided for in the Regulation, a strata manager may act as proxy. However, to date, no regulations have been passed under section 56. Shared vote 57. (1) If 2 or more persons share one vote with respect to a strata lot, only one of them may vote on any given matter. (2) If the chair is advised before or during a vote that the 2 or more persons who share the one vote disagree on how their vote should be cast on a matter, the chair must not count their vote in respect of that matter. Note that section 57 does not specify which of the 2 or more persons is the one entitled to vote. Court appointed voter 58. (1) If there is no person to vote in respect of a strata lot, an owner, the strata corporation or an interested person may apply to the Supreme Court for an order under subsection (2). (2) On application under subsection (1), the court may make an order declaring that there is no person to vote in respect of the strata lot, and appointing the Public Guardian and Trustee or any other person to vote in respect of the strata lot. (3) If the application concerns a matter that requires a unanimous vote and the court is satisfied that there is no person to vote in respect of a strata lot, the court must make an order under subsection (2). (4) The court may make any order it considers advisable, including an order respecting the payment of fees, to give effect to an appointment of the Public Guardian and Trustee or other person. (5) The court may vary an order made under this section. Division 6 of Part 4 entitles an owner, a purchaser, a lender, or a tenant, or any person authorized by those parties, to request an Information Certificate from the strata corporation. This Certificate is in Form and is found among the forms appended to the Regulation. The strata corporation is required to provide this Information Certificate within one week of receiving such a request. See also the discussion of Information Certificates in Chapter 12 of this Manual and Chapter 13 of The Condominium Manual. Information Certificate 59. (1) Within one week of a request by an owner, a purchaser or a person authorized by an owner or purchaser, the strata corporation must give to the person making the request an Information Certificate in the prescribed form. (2) The certificate must contain the information required by subsection (3), as of the date of the certificate. (3) The certificate must disclose all of the following in respect of the strata corporation and the strata lot for which the request is made: (a) the monthly strata fees payable by the owner; (b) any amount that the owner owes the strata corporation, other than an amount paid into court or to the strata corporation in trust under section 114; (c) any agreements under which the owner takes responsibility for expenses relating to alterations to a strata lot, the common property or the common assets; (d) any amount that the owner is obligated to pay in the future for a special levy that has already been approved and the date by which the payment is to be made; (e) any amount by which the expenses of the strata corporation for the current fiscal year are expected to exceed the expenses budgeted for the fiscal year; (f ) the amount in the contingency reserve fund minus any expenditures which have already been approved but not yet taken from the fund; (g) any amendments to the bylaws that are not yet filed in the land title office; (h) any resolution passed by a ¾ vote or unanimous vote that is required to be filed in the land title office but that has not yet been filed in the land title office;

16 Chapter 13 Overview of the Strata Property Act and Regulation (i) any notice that has been given for a resolution that has not been voted on, if the resolution requires ¾ vote or unanimous vote or deals with an amendment to the bylaws; (j) any court proceeding or arbitration in which the strata corporation is a party and any judgments or orders against the strata corporation; (k) any notices or work orders received by the strata corporation that remain outstanding for the strata lot, the common property or the common assets; (l) the number of strata lots in the strata plan that are rented; (l.1) which parking stalls and storage lockers, if any, have been allocated to the strata lot; and (m) any other information required by the regulations. (4) Copies of all of the following must be attached to the certificate: (a) the rules of the strata corporation; (b) the current budget of the strata corporation; (c) the owner developer s Rental Disclosure Statement under section 139, if any; (d) the most recent depreciation report, if any, obtained by the strata corporation under section 94. (5) The information in subsection (3) disclosed in a certificate is binding on the strata corporation in its dealings with a person who relied on the certificate and acted reasonably in doing so. (6) On application by the strata corporation, by an owner or by a person who is affected by a certificate, the Supreme Court may make any order it considers just in the circumstances to give effect to or relieve the strata corporation from some or all of the consequences of an inaccurate certificate. (7) The strata corporation may charge, to the person requesting the certificate, a fee for the certificate of not more than the amount set out in the regulations and may refuse to issue the certificate until the fee is paid. Because the Information Certificate is a document relied upon by prospective purchasers, lenders and tenants, it is incumbent upon the strata manager to ensure that all facts contained therein and all attached documents are accurate and up-to-date. Failure to do so may well result in exposure to civil liability for negligence. The Real Property Section (Vancouver) of the Canadian Bar Association has passed resolutions which provide that, in a standard residential conveyance, the purchaser (or his/her counsel) should obtain an Information Certificate. Regulation 4.4 provides that the maximum fee for providing an Information Certificate is $35 plus the cost of photocopying, or other means of reproduction, up to 25 cents per page. Division 7 of Part 4 sets out the legislation governing the giving of notice to other parties and the requirement to provide information. Notice to mortgagee 60. A mortgagee of a strata lot who wishes to receive notices of annual or special general meetings under section 45 and notices of money owing under section 113 must give a Mortgagee s Request for Notification in the prescribed form to the strata corporation. Section 4.5 of the Regulation provides that a Mortgagee s Request for Notification under section 60 of the Act expires on the earlier of the following: (a) 5 years from the date of the request; (b) the date the mortgagee ceases to be a mortgagee of the strata lot. Notice Given by Strata Corporation 61 (1) A notice or other record or document that the strata corporation is required or permitted to give to a person under this Act, the regulations, the bylaws or the rules must be given to the person, (a) if the person has provided the strata corporation with an address outside the strata plan for receiving notices and other records or documents, (i) by leaving it with the person, or (ii) by mailing it to the address provided, or (b) if the person has not provided the strata corporation with an address outside the strata plan for receiving notices and other records or documents, (i) by leaving it with the person,

17 13.14 Strata Management Licensing Course Manual (ii) by leaving it with an adult occupant of the person s strata lot, (iii) by putting it under the door of the person s strata lot, (iv) by mailing it to the person at the address of the strata lot, (v) by putting it through a mail slot or in a mail box used by the person for receiving mail, (vi) by faxing it to a fax number provided by the person, or (vii) by ing it to an address provided by the person for the purpose of receiving the notice, record or document. (2) The notice, record or document may be addressed to the person by name, or to the person as owner or tenant. (3) A notice or other record or document that is given to a person under subsection (1) (a) (ii) or (b) (ii) to (vii) is conclusively deemed to have been given 4 days after it is left with an adult occupant, put under the door, mailed, put through the mail slot or in the mail box, faxed or ed. The notice provisions in section 61 are mandatory, so no methods of delivery will likely be valid other than those contemplated by section 65, below. Again, if a notice must be delivered at least 2 weeks prior to a meeting, it would also be prudent practice to deliver it at least 20 days before the meeting to comply with both section 25 of the Interpretation Act and section 61(3) of the Act. Notice Given to Strata Corporation 63. (1) A notice or other record or document that is required or permitted under this Act, the regulations, the bylaws or the rules to be given to the strata corporation must be given to the strata corporation (a) by leaving it with a council member, (b) by mailing it to the strata corporation at its most recent mailing address on file in the land title office, (c) by faxing it or ing it to (i) the strata corporation using the strata corporation s fax number or address, or (ii) a fax number or address provided by a council member for the purpose of receiving the notice, record or document, or (d) by putting it through the mail slot, or in the mail box, used by the strata corporation for receiving notices, records and documents. (2) A notice or other record or document that is given to the strata corporation under subsection (1) personal service direct physical delivery of a document to its intended recipient in person (b) to (d) is conclusively deemed to be given 4 days after it is mailed, faxed, ed or put through the mail slot or in the mail box. You may also wish to refer to Chapter 15 (Strata Meetings and Communications) of this manual and Chapter 12 in The Condominium Manual for further clarification of the notice requirements of the Act. Legal service on strata corporation 64. Despite section 63 but subject to another enactment or a court order, service on a strata corporation of a notice of a proceeding in any court may only be effected by (a) personal service on a council member, or (b) mailing it, by registered mail, to the strata corporation at its most recent mailing address on file in the land title office. Informing Resident Owners and Tenants 65. For the purposes of sections 98 (6), 106, 108 (4), 125 (4), 128 (4) and 167, and any regulations that require the strata corporation to inform owners or tenants of certain matters, the strata corporation may, instead of giving notice under section 61, inform resident owners and tenants by one or more of the following methods or by any other method: (a) leaving a document containing the information at a location designated by the strata corporation for the distribution of such information; (b) posting a document containing the information in a part of the common property designated by the strata corporation for the posting of such information. The sections to which section 65 applies deal with amendments to strata fees, rules or bylaws, expenditures of special levies and legal action involving the strata corporation. Additionally, the Standard Bylaws require

18 Chapter 13 Overview of the Strata Property Act and Regulation the strata council to inform owners of the minutes of council meetings. It is important to distinguish between giving notice to an owner as required by section 61 of the Act, and informing owners in accordance with section 65 of the Act. Many strata councils believe that the minutes of council meetings must be delivered to owners in one of the ways set out in section 61 of the Act. In fact, the owners only need to be informed of the council meeting minutes. Any other method would include posting the information on a web site maintained by the strata corporation, or including the information in the minutes of a strata council meeting in addition to informing owners in one of the ways permitted for providing notice. Part 5 (sections 66-90) Property Part 5 of the Act contains several provisions which are of particular importance to strata managers. Part 5 includes: General Property Matters (Division 1); Limited Common Property and Exclusive Use of Common Property (Division 2); Property Acquisition and Disposal (Division 3); Work Orders (Division 4); and Builders Liens and Other Charges (Division 5). Division 1 of Part 5 focuses on ownership of common property, assessment and taxation, strata lot boundaries, easements, changes to strata lots and changes in use of common property, and, finally, repairs of common property. Ownership of Property 66. An owner owns the common property and common assets of the strata corporation as a tenant in common in a share equal to the unit entitlement of the owner s strata lot divided by the total unit entitlement of all the strata lots. The BC Court of Appeal, in Strata Plan No. VR368 v. Marathon Realty Co., 1982 CanLII 493, held that although the strata corporation may nominally own the common assets, they are beneficially owned by all the owners. Note that it is possible to register charges at the Land Title Office against common property alone. Chapter 17 of The Condominium Manual contains further details regarding the common property of a strata corporation. Strata lot boundaries 68. (1) Unless otherwise shown on the strata plan, if a strata lot is separated from another strata lot, the common property or another parcel of land by a wall, floor or ceiling, the boundary of the strata lot is midway between the surface of the structural portion of the wall, floor or ceiling that faces the strata lot and the surface of the structural portion of the wall, floor or ceiling that faces the other strata lot, the common property or the other parcel of land. (2) If a strata lot is not separated from another strata lot, the common property or another parcel of land by a wall, floor or ceiling, the boundary of the strata lot is as shown on the strata plan. (3) A boundary shown on the strata plan must be shown in a manner approved by the registrar. (4) Despite subsections (1) to (3), but subject to the regulations, in the case of a bare land strata plan, the boundaries must be shown on the strata plan (a) by reference to survey markers, and (b) in compliance with rules, if any, made under section 75 of the Land Surveyors Act for the purposes of this section. As discussed earlier in this chapter, section 68 defines the boundaries of a strata lot as being midway between the surfaces of the structural portion of a wall. Therefore if the boundary is midway, it raises the question as to whether a window, or door, or skylight is part of a strata lot or part of the common property. The definition of common property does not expressly include windows, doors and skylights on the exterior of a building. As discussed earlier in this chapter, because there is no clear allocation of responsibility in the Act, the owners may be at least partly responsible for repair and maintenance of windows, doors, and skylights, that straddle the boundary line as noted in Kearsly v. Strata Plan KAS 1215, 2008 BCSC The ownership of structural walls between two strata lots is shared by the owners of the strata lots However, relying on section 72(3) of the Act, the Schedule of Standard Bylaws at section 8(c) and 8(d) resolves issues relating to repair and maintenance by allocating responsibility for these building parts to the strata corporation.

19 13.16 Strata Management Licensing Course Manual Changes to strata lot 70. (1) An owner or owners may, with the prior written approval of the strata corporation, remove all or part of a wall that is a common boundary between (a) adjoining strata lots, or (b) strata lots that have been consolidated into a single strata lot. (2) The strata corporation must approve the proposed removal under subsection (1) unless the removal (a) fails to comply with (i) the British Columbia Building Code referred to in the Building Regulations of British Columbia, (ii) any applicable municipal or regional district bylaws, (iii) any applicable Nisga a Government laws, or (iv) any applicable standard established by a treaty first nation in accordance with an agreement described in section 692 (5) of the Local Government Act, or (b) interferes with the provision of utilities or other services to any other strata lot or to the common property. (3) The owner or owners must give copies of any required building permits to the strata corporation when seeking its approval under subsection (1). (4) Subject to the regulations, if an owner wishes to increase or decrease the habitable part of the area of a residential strata lot, by making a nonhabitable part of the strata lot habitable or by making a habitable part of the strata lot nonhabitable, and the unit entitlement of the strata lot is calculated on the basis of habitable area in accordance with section 246 (3) (a) (i) or on the basis of square footage in accordance with section 1 of the Condominium Act, R.S.B.C. 1996, c. 64, the owner must (a) seek an amendment to the Schedule of Unit Entitlement under section 261, and (b) obtain the unanimous vote referred to in section 261 before making the change. Minor changes to strata lot size Reg. 5.1 (1) An owner who wishes to decrease the habitable part of the area of a residential strata lot without amending the Schedule of Unit Entitlement need not comply with the requirements set out in section 70 (4) of the Act. (2) An owner who wishes to increase the habitable part of the area of a residential strata lot without amending the Schedule of Unit Entitlement need not comply with the requirements set out in section 70 (4) of the Act if (a) the increase to the habitable part, combined with any previous increase to the habitable part, is less than 10% of the habitable part and less than 20 square metres, and (b) the owner obtains the prior written approval of the strata corporation. It would be prudent practice for the strata council to require that the lot owner obtain construction insurance. If no building permit is required, it would also be prudent for the strata council to require that the lot owner provide a certificate from an architect or an engineer certifying that the conditions set out in section 70(2)(a) and (b) do not exist. Section 70 of the Act applies only in the case where an owner wishes to remove a wall between two strata lots or where the habitable area of a strata lot is either increased or decreased. All other alterations to a strata lot that a strata corporation wishes to control can be included in the strata corporation s bylaws. The Standard Bylaws require owners to obtain approval before making any alteration to a strata lot that involves: the structure of a building; the exterior of a building; chimneys, stairs, balconies or other things attached to the exterior of a building; doors, windows or skylights on the exterior of a building, or that front on the common property; fences, railings or similar structures that enclose a patio, balcony or yard; common property located within the boundaries of a strata lot; or those parts of the strata lot which the strata corporation must insure under section 149 of the Act. A strata corporation can always amend the Standard Bylaws to increase or decrease the alterations to a strata lot for which approval must be obtained.

20 Chapter 13 Overview of the Strata Property Act and Regulation An Ontario court has held that a strata corporation has reasonably wide discretion when determining the criteria for authorizing work under the equivalent Ontario statutory provision. In McKinstry v. York Condominium Corp. No 472, 2003 CanLII (ON SC), it was held that the condominium corporation did not act in an oppressive or unfairly prejudicial manner by refusing to permit the lot owner to perform certain renovations on the basis that: the renovations might increase noise levels above and below the lot owner s unit; they did not want to set a precedent leading to uncontrolled renovations in the building which might lead to a potential reduction in the value of all the units; and the renovations might interfere with designed airflows, perhaps leading to excessive heat, and that future purchasers might hold the condominium board responsible for the deficiencies. Change in use of common property 71. Subject to the regulations, the strata corporation must not make a significant change in the use or appearance of common property or land that is a common asset unless (a) the change is approved by a resolution passed by a ¾ vote at an annual or special general meeting, or (b) there are reasonable grounds to believe that immediate change is necessary to ensure safety or prevent significant loss or damage. To date, no regulation has been passed under section 71. The term significant change is not defined in the Act despite the fact that this term is the key to determining the application of the provisions of section 71. In Chan v. The Owners, Strata Plan VR677, Vancouver Registry No. S115516, the Judge stated that both objective and subjective indicators may need to be considered to determine whether an intended change to common property was significant. Although acknowledging that the list was not exhaustive, the Judge stated that the objective factors that should be considered included: the visibility or non-visibility to residents and the general public; whether the use and enjoyment of other strata lots or an existing benefit enjoyed by other strata lots was affected; whether there was an interference or impact on the marketability or value of other strata lots as a result of the change; the number of strata lots in the strata plan; and whether the strata lots are residential, non-residential or a combination of the two. The subjective factors that the Judge considered relevant included: whether the strata corporation goverened itself in a formal manner in compliance with the Act or more informally reaching decisions on a consensus basis as often occurs in small strata corporations; whether similar changes have been approved or permitted in the past; and whether the owners who are objecting were permitted, either through approval or acquiescence, to make similar changes in the past. Although section 71 prohibits a strata corporation from changing the use of common property, the Act does not expressly prohibit an owner from changing the use of limited common property designated for a specific owner s use. Ordinarily, the bylaws regulate how an owner can use or alter limited common property (for example, see section 6 of the Standard Bylaws). Repair of Property 72. (1) Subject to subsection (2), the strata corporation must repair and maintain common property and common assets. (2) The strata corporation may, by bylaw, make an owner responsible for the repair and maintenance of (a) limited common property that the owner has a right to use, or

21 13.18 Strata Management Licensing Course Manual (b) common property other than limited common property only if identified in the regulations and subject to prescribed restrictions. (3) The strata corporation may, by bylaw, take responsibility for the repair and maintenance of specified portions of a strata lot. To date, no regulation has been passed under section 72(2)(b). Standard Bylaw 8 sets out the strata corporation s responsibility to repair and maintain portions of a strata lot. As a Strata Manager... As strata corporations may amend Standard Bylaw 8 in order to increase or reduce the portions of a strata lot that the strata corporation must repair and maintain, it is essential that you are familiar with the specific repair and maintenance obligations of each of the strata corporations to which you provide management services. The quintessential statement regarding the mandatory duty of a strata corporation to repair common property and assets was set out in Royal Bank of Canada v. Holden, 1996 CanLII 3440 (BC SC) and has been cited in numerous subsequent decisions: The strata corporation has certain essential duties under the Act to maintain common property, common facilities and assets of the strata corporation. These are fundamental duties, and, I perceive, their execution by the strata corporation is critical to the realization of the condominium concept that is people living together in individually owned units within a common shell. The meaning of the word repair has been considered by the BC Courts. In Taychuk v. Strata Plan LMS744, 2002 BCSC 1638, the court stated: It is true that the primary meaning of the word repair is to restore to sound condition that which has previously been sound, but the word is also properly used in a sense of to make good. Moreover, the word is commonly used to describe the operation of making an article good or sound, irrespective of whether the article has been good or sound before. See Chapters 25 and 26 of The Condominium Manual for a detailed discussion regarding the strata corporation s mandatory duty to repair common property and common assets, the standard of care when doing so, and examples of commonly arising problems and issues in this regard. Division 2 of Part 5 focuses on limited common property and exclusive use of common property Designation of limited common property 73. Common property may be designated as limited common property (a) by the owner developer (i) by a designation on the strata plan when it is deposited in the land title office, or (ii) by a plan amendment under section 258, (b) by an amendment to the strata plan under section 257, or (c) by a resolution passed at an annual or special general meeting under section 74. The registration requirements in sections 73 and 74 in respect of limited common property designations are designed to ensure that purchasers of strata lots will be able to ascertain with certainty what limitations, if any, have been imposed on the common property. Section 73 does not address whether an owner entitled to the use of limited common property is allowed to lease or licence it to a third party. It may well be that an owner cannot lease limited common property because the owner s ownership interest in common property is that of a tenant in common (see section 66 of the Act). However, with council approval, it is likely that an owner can licence the limited common property to a third party. Short term exclusive use 76. (1) Subject to section 71, the strata corporation may give an owner or tenant permission to exclusively use, or a special privilege in relation to, common assets or common property that is not designated as limited common property.

22 Chapter 13 Overview of the Strata Property Act and Regulation (2) A permission or privilege under subsection (1) may be given for a period of not more than one year, and may be made subject to conditions. (3) The strata corporation may renew the permission or privilege and on renewal may change the period or conditions. (4) The permission or privilege given under subsection (1) may be cancelled by the strata corporation giving the owner or tenant reasonable notice of the cancellation. Short term exclusive use Reg Despite section 76 (2) of the Act, a right, permission or privilege granted, before the coming into force of this section, under section 117 (f ) of the Condominium Act or a similar bylaw under which the strata corporation gives an owner permission to exclusively use or enjoy, or a special privilege in relation to, common property that is not designated as limited common property under section 53 of the Condominium Act continues to be enforceable in accordance with its terms, but may be renewed only as permitted by section 76 of the Act. As a result of Regulation 17.7, if a strata corporation granted an owner permission to use or a privilege in respect of common property prior July 1, 2000, which was the date the Act came into force, the permission or privilege will continue to apply for its original term, even if that term is longer than one year. As a Strata Manager... Strata corporation permission for an owner or tenant to exclusively use common property provided on or after July 1, 2000 can only be for a maximum of one year; however, it may be renewed annually. If an owner claims that the permission to exclusively use common property was given prior to July 1, 2000, it will be necessary for you to determine the length of time for which the exclusive use was originally granted. When dealing with permission for exclusive use granted prior to July 1, 2000, you will not be able to assume that every grant of exclusive use expired after one year. Access to common property by strata corporation 77. An owner who has the right to use common property, including limited common property, or common assets must allow the strata corporation reasonable access to the common property or common assets to exercise its powers and perform its duties. An owner is entitled to refuse access for purely recreational purposes, as opposed to access by the strata corporation for maintenance or security reasons (Poole v. Strata Plan VR2506, 2004 BCSC 1613). You should also be aware that section 7 of the Standard Bylaws provides that an owner, tenant, occupant or visitor must allow a person authorized by the strata corporation to enter the strata lot in an emergency without notice, or, at a reasonable time on 48 hours written notice, to inspect, repair or maintain the common property and assets. Division 3 of Part 5 focuses on the acquisition and disposal of land and common property. Division 4 of Part 5 focuses on work orders made against both the strata corporation and the individual lot owners. Work order against strata corporation property 83. The strata corporation must comply with a requirement to do work on or to (a) common property, or (b) land that is a common asset if the work is required by a notice or order of a public or local authority which is authorized by law to require the work, and the notice or order is given to the strata corporation. Work order against strata lot 84. (1) Except as provided in section 41.1 of the Fire Services Act, a strata corporation that receives a notice or order requiring work to be done on or to a strata lot, from a public or local authority authorized by law to require the work, must promptly give the notice or order to the owner of the strata lot.

23 13.20 Strata Management Licensing Course Manual (2) An owner who receives a notice or order requiring work to be done on or to the owner s strata lot, from a public or local authority authorized by law to require the work or from the strata corporation under subsection (1), must do the work. Section 41.1 of the Fire Services Act provides as follows: 41. (1) An order under section 22, 30 or 33 that applies to a strata lot may be delivered to the strata corporation by service in accordance with section 63 of the Strata Property Act if any of the following circumstances apply: (a) the order cannot be delivered to the owner or occupier of the strata lot after reasonable efforts at delivery; (b) the order has been delivered to the owner or occupier, but the owner or occupier does not appeal the order and does not comply with the order; (c) the order has been upheld on appeal under section 27, 28 or 34, but the owner or occupier does not comply with the order. (2) An order under section 22, 30 or 33 that applies to 6 or more strata lots (a) is not required to be delivered to the owners or occupiers of the strata lots, and (b) may instead be delivered to the strata corporation by service in accordance with section 63 of the Strata Property Act. (3) If an order is delivered to a strata corporation under subsection (1) or (2), the strata corporation is deemed to be an occupier of the strata lots to which the order applies and must comply with the order. Owner s Failure to Comply with Work Order 85. (1) If an owner, after receiving the notice or order under section 84, fails to do the required work, the strata corporation may do the required work. (2) If the owner appeals the work order and advises the strata corporation in writing of the appeal, the strata corporation must wait for the results of the appeal. (3) Except in an emergency, the strata corporation must notify the owner in writing of its intention to do the work at least one week before starting the work. (4) The owner must reimburse the strata corporation for any money the strata corporation spends doing work on or to the strata lot under this section. A strata corporation may register a Form G Certificate of Lien (appended to the Regulation) against a strata lot of an owner who fails to reimburse the strata corporation for work performed. See section 116(1) (c) of the Act. Division 5 of Part 5 focuses on builders liens and other charges against strata lots. Builders Lien Act applies 86. Except as provided in sections 87 to 90 of this Act, the Builders Lien Act applies to land in a strata plan. The Land Title Branch Practice Bulletin No provides as follows: Builders Lien Claims Under no circumstances will a builders lien claim be endorsed on the common property folio, even if the labour and materials supporting the claim were supplied exclusively to the common property. Builders lien claims will continue to be endorsed as a charge on each strata lot title. You may also want to review the material in Chapter 5 of this Manual regarding registration of builders liens at the land title office. Part 6 (sections ) Finances Part 6 of the Act deals with the various aspects of strata corporation finances, including: operating fund and contingency reserve funds and the need for a deprecation report, (Division 1, ss ); contribution to expenses (Division 2, sections ); budgets (Division 3, sections ); special levies and user fees (Division 4, ss ); borrowing powers generally (Division 5, section 111); and the collection of money owing to the strata corporation (Division 6, sections ). Several provisions which are of particular importance to strata managers are listed below.

24 Chapter 13 Overview of the Strata Property Act and Regulation Division 1 of Part 6 requires the strata corporation to maintain both an operating fund and a contingency reserve fund and sets out how expenditures from each fund may occur. Section 93 of the Act provides that the strata corporation must determine the amount of the annual contribution to the contingency reserve fund subject to the Regulation. Section 94 of the Act requires strata corporations to either obtain or waive the requirement for depreciation reports by December 14, 2013, or, for strata corporations formed after December 14, 2011, a date that is six months after the strata corporation s second AGM. Both the procedure for determining the annual contribution to the CRF and the specific requirements of a depreciation report were introduced in Chapter 12. Regulation 6.2 must be read in conjunction with section 94 of the Act as it sets out, among other things, which items must be included in a depreciation report, that the service life of the items included must be considered over a 30 year period, that the report must be based on an on-site visual inspection, and that financial forecasts must be included containing at least three cash flow models to fund the contingency reserve fund. Regulation 6.2 also provides that unless waived, a depreciation report must be obtained every three years and that strata corporations of less than five strata lots are exempted from the need to obtain a depreciation report. The purpose of a depreciation report is to provide strata council members and strata lot owners with a planning tool in order to anticipate the future repair and replacement that will be required, when the repair will likely be necessary and the likely cost. The owners can then consider various cash flow models to increase the contribution to the contingency reserve fund in order to reduce the need for special levies when the time comes to carry out the repair or replacement. To assist strata corporations to pay for a depreciation report, and to obtain approval to carry out repairs recommended by a depreciating report, section 96 of the Act was amended to reduce the voting threshold from a ¾ vote to a majority vote in order to withdraw funds from the contingency reserve fund if the funds are necessary to pay for the depreciation report or are related to repair and maintenance recommended in the current depreciation report. Expenditures from contingency reserve fund 96. The strata corporation must not spend money from the contingency reserve fund unless the expenditure is (a) consistent with the purposes of the fund as set out in section 92 (b), and (b) approved or authorized as follows: (i) the expenditure is first approved by a resolution passed by (A) a majority vote at an annual or special general meeting if the expenditure is (I) necessary to obtain a depreciation report under section 94, or (II) related to the repair, maintenance or replacement, as recommended in the most current depreciation report obtained under section 94, of common property, common assets or the portions of a strata lot for which the strata corporation has taken responsibility under section 72 (3), or (B) a ¾ vote at an annual or special general meeting if the expenditure is not described in clause (A) (I) or (II); (ii) the expenditure is authorized under section 98. Division 2 of Part 6 sets out the manner in which owners must contribute to strata corporation expenses. Calculating strata fees 99. (1) Subject to section 100, owners must contribute to the strata corporation their strata lots shares of the total contributions budgeted for the operating fund and contingency reserve fund by means of strata fees calculated in accordance with this section and the regulations. (2) Subject to the regulations, the strata fees for a strata lot s share of the contribution to the operating fund and contingency reserve fund are calculated as follows: unit entitlement of strata lot total contribution total unit entitlement of all strata lots The general rule for cost allocation is contained in section 99 of the Act. The Act requires that all owners must contribute to the common expenses of the strata corporation on the basis of unit entitlement of the strata lot.

25 13.22 Strata Management Licensing Course Manual All costs must be allocated on this basis unless an exception applies. The exceptions to the general rule are section 100 of the Act and any exceptions set out in the Regulations. Section 100 Section 100 of the Act permits the owners to approve a different formula for the allocation of costs provided that the formula is approved by a unanimous vote and registered in the land title office. Note that a unanimous vote is defined in the Act as a vote in favour of a resolution by all the votes of all the eligible voters. Limited Common Property Regulation 6.4(1) permits operating costs that benefit only limited common property to be allocated to only those owners entitled to use the limited common property. It should be noted that the regulation is limited to permitting only operating costs to be allocated to certain owners. Types Regulation 6.4(2) permits operating costs that relate to a type of strata lot to be allocated to owners of that type of strata lot provided that a bylaw has been filed in the Land Title Office which identifies the types of strata lots. Similar to the exception for limited common property expenses, only operating costs may be allocated on the basis of types of strata lots. Repair of Portions of Strata Lots Regulation 6.5 permits operating expenses and costs paid for by a special levy that relate to the repair and maintenance of portions of a strata lot which the strata corporation is responsible to repair to be allocated to the owners whose strata lot is repaired. Regulation 6.5 applies only to the repair of strata lots and only where the strata corporation has taken on the responsibility to repair portions of some, but not all, strata lots. When considering the exceptions to the general rule in section 99, it is important to note that only section 100 permits costs to be allocated in a manner other than on the basis of unit entitlement. The exceptions permitted by the Regulation permit the expenses to be allocated to less than all owners, but the expenses must nonetheless be allocated on the basis of unit entitlement among the owners required to pay the expense. A further way that the general rule of allocating an expense to all owners can be avoided is by the creation of sections, which is discussed under Part 11 of the Act. Once sections are created, the expenses that are solely attributable to the section, and which are approved by the owners within the section are allocated among the owners in the section on the basis of unit entitlement. Sections are distinct from the exceptions noted above in that they require separate budgets approved by the owners in the section. As a Strata Manager... If a strata council is allocating costs in a manner that is not in compliance with the Act and Regulation, you should point out the appropriate sections of the Act and Regulation to the strata council and recommend that the strata corporation obtain legal advice. The advice to the strata council should be in writing to ensure that there is no possibility that an owner or subsequent strata council can allege that the improper allocation of costs was as a consequence of your advice and direction. Division 3 of Part 6 requires strata corporations to approve a budget at each annual general meeting. The budget and financial statements must contain the information set out in Regulation 6.6 and 6.7. Section 107 of the Act permits a strata corporation to include in a bylaw that establishes a schedule for the payment of strata fees a rate of interest that may be charged on overdue strata fees. Regulation 6.8 sets the maximum interest that may be charged at 10% per annum compounded annually. As a Strata Manager... You should ensure that the accounting department has been advised of the strata corporations that are permitted by their bylaws to charge interest on arrears of strata fees and that the accounting department is aware that interest cannot be calculated on fines. You should also ensure that the interest is properly calculated and recorded on each owner s ledger if the owner is in arrears.

26 Chapter 13 Overview of the Strata Property Act and Regulation Division 4 of Part 6 permits strata corporations to raise funds by means of special levies. Section 108 of the Act sets out the matters that must be addressed in the resolution. As a Strata Manager... Because section 108 is specific about what must be included in the special levy resolution, it is prudent practice for a strata manager to refrain from drafting such resolutions and to recommend to the strata council that legal advice be obtained. Section 108(4.1) of the Act permits a strata corporation to charge interest on overdue special levies if the rate of interest is provided for in either the resolution or the strata corporation s bylaws. As a Strata Manager... If the strata corporation s bylaws do not specifically permit interest to be charged on arrears of special levies, you should advise the strata council that such a provision should be included in the resolution. Section 109 of the Act establishes who owes the special levy when a strata lot sells. As a Strata Manager... If a resolution provides that the special levy is to be paid in instalments, some strata corporations include in the resolution that all payments will be due upon the sale of the strata lot. You may wish to advise the strata council that such a provision is unnecessary, as the responsibility for the payment of a special levy is governed by section 109 of the Act. Division 5 of Part 6 permits a strata corporation to borrow money provided that the resolution has been approved by a ¾ vote of the strata corporation. As buildings age and the need for costly repairs increases, it is likely that more strata corporations will want or need to borrow funds to pay for such repairs. Various financial institutions offer loans to strata corporations for such purposes. As a Strata Manager... The resolution authorizing a strata corporation to borrow funds is complicated and should only be prepared by legal counsel. Division 6 of Part 6 sets out the process for the collection of funds owing to the strata corporation. Section 116 of the Act permits a strata corporation to register a lien against the owner s strata lot if the owner owes strata fees, special levies, a reimbursement of the cost of work ordered by a public authority and carried out by the strata corporation, or the strata lot s share of a judgement against the strata corporation. Section 116 of the Act establishes that the strata corporation s lien ranks in priority to all other liens or charges with only limited exceptions. Section 118 of the Act permits reasonable legal fees, land title and court registry fees and other reasonable disbursements to be added to the amount of the lien. Section 112 of the Act requires that a demand for payment be sent to the owner before a lien is filed. If payment is not received after the lien has been filed, the strata corporation is permitted to apply to the Supreme Court for an order that the strata lot be sold. The collection procedures for strata corporations are similar to foreclosure proceedings. However, there are a number of significant differences including a reduction in the number of court appearances required to obtain an order for forced sale of a strata lot and usually the length of the redemption period which must occur prior to the strata lot being offered for sale is less than the redemption period required in a foreclosure. Thus, in many ways, the process available to the strata corporation is faster and more straightforward.

27 13.24 Strata Management Licensing Course Manual As a Strata Manager... You should monitor the strata corporation s accounts receivable ledger closely and encourage the strata council to utilize the collection mechanisms available in Division 6 before arrears become seriously delinquent. You will find further materials regarding budgeting and strata finances in later chapters of this manual, as well as in The Condominium Manual in Chapter 15. Part 7 (ss ) Bylaws and Rules Part 7 of the Act sets out the legislation with respect to bylaws and rules, and includes general information about bylaws, the Standard Bylaws, pet and age bylaws and dispute resolution (Division 1, sections ). It also contains sections setting out the procedure for amending bylaws (Division 2, sections ) and enforcing the bylaws and rules (Division 3, sections ). Bylaws and rules are also discussed in Chapter 12. Division 1 of Part 7 sets out general provisions regarding bylaws and rules. By virtue of section 120 of the Act, the Standard Bylaws are the bylaws that apply to every strata corporation unless the strata corporation has amended its bylaws. Standard Bylaws 120 (1) The bylaws of the strata corporation are the Standard Bylaws except to the extent that different bylaws are filed in the land title office. (2) On deposit of the strata plan an owner developer may file bylaws that differ from the Standard Bylaws. Accordingly, it is important to check the extent to which a particular strata corporation has amended the Standard Bylaws. However, as a starting point, licensees should be aware of the content of the Standard Bylaws, which is reproduced in Appendix Section 122 of the Act restricts a strata corporation s ability to pass bylaws relating to the posting of For Sale signs and the times for showing of common property and the holding of open houses. Section 122 of the Act permits a strata corporation to limit the location of For Sale signs and to limit the times for showing common property and holding open houses; however, a strata corporation may not prohibit such activities. Section 123 of the Act contains a grandfather provision for pets and individuals who are underage when new pet prohibition and age restriction bylaws are approved. Section 123(1) of the Act provides that a pet prohibition bylaw does not apply to pets living with an owner, tenant or occupant at the time the bylaw is passed. Similarly section 123(2) of the Act provides that an age restriction bylaw does not apply to a person who resides in the strata lot at the time the bylaw is passed. As a Strata Manager... If a strata corporation is proposing a new pet prohibition or age restriction bylaw, it will be necessary to create a list of existing pets, or underage occupants residing in strata lots at the time the bylaw is passed in order to know which pets or persons are grandfathered. The simplest way to do this may be to advise owners to notify the strata council or strata manager of any pets or underage occupants residing in a strata lot prior to the general meeting at which the bylaw is to be considered. Section 125 of the Act permits a strata corporation to create rules to govern the use, safety, and condition of common property and common assets. The scope of a rule is very limited. Rules cannot be used to regulate activities in strata lots. Thus, a rule prohibiting pets would be unenforceable, since pets reside in a strata lot. Although rules take effect once they are approved by the strata council, rules must be ratified by the owners by means of a majority vote at the next general meeting in order to remain in effect. One ratified, the rules remain in effect until repealed. Rules are not filed in the land title office. Therefore, it is necessary for each strata council to be aware of the rules approved by prior strata councils and to know whether the rules have

28 Chapter 13 Overview of the Strata Property Act and Regulation been ratified. It is also necessary for the strata council to maintain a register of the rules to ensure that previously approved rules are not lost or forgotten. Division 2 of Part 7 sets out the procedure for amending bylaws. Amendment of bylaws 126. The bylaws of a strata corporation may be changed, repealed, replaced, added to or otherwise amended by complying with the requirements of this Division. As established by section 120 of the Act, a strata corporation will have the Standard Bylaws except as amended. Section 126 of the Act makes it clear that the strata corporation s bylaws, which would initially include the Standard Bylaws, may be added to, repealed, and otherwise amended. As a result, the strata corporation may simply amend the wording of the Standard Bylaws, it may replace provisions of the Standard Bylaws with completely new provisions, or it may add new bylaws and maintain or repeal the provisions of the Standard Bylaws. Similarly, once amendments have been filed in the land title office, they may be amended, replaced or repealed. Every bylaw filing is sequentially listed on the Strata Plan General Index maintained by the land title office for each strata corporation. However, not every filing listed on the Strata Plan General Index may be in effect as some bylaw filings may have been repealed by a later filing. Unless the filing in the land title office indicates how the current amendments impact prior filings, it may be necessary to review the resolutions in the general meeting minutes to understand whether prior filings were intended to be repealed. Although it was not mandatory, many strata corporations repealed and replaced their bylaws after the Act came into force. As a Strata Manager... Although many strata corporations will be able to provide a copy of the strata corporation s bylaws that are currently in force, in order to confirm the accuracy of the bylaw package, it will be necessary to begin by obtaining the Strata Plan General Index from the land title office through BC Online. Each bylaw filing is listed and identified by a filing number. The bylaw amendments can then be obtained beginning with the most recent filings. Once a bylaw package is obtained that indicates that it replaces all previously filed bylaws, it will no longer be necessary to obtain prior filings. If a bylaw filing appears to contain a comprehensive set of bylaws, but does not indicate that the previously filed bylaws are repealed, it will be necessary to review the resolution that approved the comprehensive package to determine if the bylaw package was intending to replace the previously filed bylaws. If there is uncertainty about what bylaws are in force and which may have been repealed, you should encourage the strata council to obtain legal advice. As a Strata Manager... You should ensure that the resolution to amend the bylaws clearly establishes whether the prior filings are being amended or replaced with the current amendments. Section 127 of the Act prohibits bylaw amendments for bare land strata developments and developments containing residential strata lots prior to the second AGM unless the amendment is approved by a unanimous vote. Section 128 of the Act establishes the procedure to amend the bylaws. Section 128(1)(c) is extremely significant to strata managers. Recall that Figure 12.3 of Chapter 12 contains a useful table for the approval required to amend bylaws. Bylaw amendment procedures 128. (1) Subject to section 197, amendments to bylaws must be approved at an annual or special general meeting,...

29 13.26 Strata Management Licensing Course Manual (c) in the case of a strata plan composed of both residential and nonresidential strata lots, by both a resolution passed by a ¾ vote of the residential strata lots and a resolution passed by a ¾ vote of the nonresidential strata lots, or as otherwise provided in the bylaws for the nonresidential strata lots. In every strata corporation that contains both residential and non-residential strata lots, all bylaw amendments must be passed by a ¾ vote of the residential owners and a ¾ vote of the non-residential owners. Section 128(1)(c) of the Act clearly specifies that the resolution must be passed by each group. Thus, if one of the groups, such as the non-residential strata lots, is not represented at the meeting or votes against the resolution, the resolution amending the bylaws does not pass. As a result of section 128(1)(c), either the residential or non-residential strata lots owners can effectively veto bylaw amendments regardless of the limited number of votes such strata lots may represent. It is worth noting that bylaw amendments are the only resolutions that must be passed by each of the residential and non-residential strata lots. As a Strata Manager... When presenting a resolution to amend bylaws in a development containing both residential and non-residential strata lots, the voting process is easier if the non-residential strata lots are given a different coloured voting card. Division 3 of Part 7 sets out the bylaw enforcement options available to the strata corporation and the bylaw enforcement procedure that must be followed. In order to levy a fine for a breach of a bylaw, the strata corporation must comply with section 135 of the Act. Complaint, right to answer and notice of decision 135. (1) The strata corporation must not (a) impose a fine against a person, (b) require a person to pay the costs of remedying a contravention, or (c) deny a person the use of a recreational facility for a contravention of a bylaw or rule unless the strata corporation has (d) received a complaint about the contravention, (e) given the owner or tenant the particulars of the complaint, in writing, and a reasonable opportunity to answer the complaint, including a hearing if requested by the owner or tenant, and (f ) if the person is a tenant, given notice of the complaint to the person s landlord and to the owner. (2) The strata corporation must, as soon as feasible, give notice in writing of a decision on a matter referred to in subsection (1) (a), (b) or (c) to the persons referred to in subsection (1) (e) and (f ). (3) Once a strata corporation has complied with this section in respect of a contravention of a bylaw or rule, it may impose a fine or other penalty for a continuing contravention of that bylaw or rule without further compliance with this section. Case law has held that letters advising owners of fines without providing the owner with an opportunity to be heard do not comply with section 135 of the Act and, as a result, the fines assessed are not collectable. Despite how obvious a breach of a bylaw appears to be, a strata corporation may not fine an owner unless the strata corporation has received a complaint, given the owner the particulars of the complaint and allowed the owner an opportunity to respond or request a hearing. Additionally, if the person allegedly in breach of the bylaws is a tenant, the letter must also be sent to the landlord and owner.