A year-end update of the Strata Property Law Project
December 16, 2015
BY Kevin Zakreski
The Strata Property Law Project—Phase Two has seen significant progress in 2015. The high points of the year were the publication of the committee’s first report, the Report on Terminating a Strata (PDF), and the implementation of that report’s recommendations in Bill 40. The year has also seen extensive engagement with sections, types, and phases, as the committee gears up for its second public consultation, which will focus on complex stratas.
Report on Terminating a Strata
In February, BCLI published the committee’s Report on Terminating a Strata. The report examined the development of British Columbia’s legislation on terminating a strata and considered examples for reform from other Canadian and oversees jurisdictions. The report was the culmination of a public consultation, which saw the committee receive 130 responses to its proposals, garnering one of the highest number of responses ever to a BCLI consultation.
In the end, the committee made 21 recommendations for reform. Its major recommendation was to have the act move from requiring the unanimous consent of owners and holders of registered charges on the strata to authorize termination to a supermajority requirement. Under this supermajority requirement, at least 80 percent of the strata’s owners would have to consent to its termination.
In order to ensure that the process gives adequate protection to any owners or registered chargeholders who dissent from the decision to terminate, the report also recommended that (unless the strata has fewer than five strata lots) a strata be required, after it garners the support of at least 80 percent of its owners, to apply for a court order authorizing termination as being in the best interests of the strata.
The report included draft legislation, illustrating how the committee’s recommendations could be implemented.
In October, Bill 40 was introduced into the legislative assembly. Among other subjects, the bill adopted the substance of the committee’s recommendations for reform. The bill received royal assent in November. It will come into force by regulation.
Progress on complex stratas
The committee has made significant progress in examining how complex, primarily mixed-use, stratas are created and operated. This is an area that has seen considerable change and development since the Strata Property Act came into force in July 2000. The committee sees many opportunities to fine tune and improve the law.
Complex stratas raise many difficult issues concerning sharing of common expenses, control of common property, and governance. The committee’s work in this area has focussed on three devices in the Strata Property Act that may be used to manage these issues: sections, which are effectively mini-strata corporations; types, which allow for allocation of operating expenses based on the use or architectural characteristics of strata corporations; and phases, which allow for the development of a complex strata gradually, in segments.
The committee has recorded 53 tentative recommendations for reform on complex stratas. It has completed its review of sections and types and is nearing completion of phases. After the review of phases is complete, the committee will begin reviewing a draft consultation paper on complex stratas, for publication in 2016.
Initial look at leasehold stratas
The committee looks forward to tackling leasehold stratas later in the project, possibly in 2016, possibly in 2017. But it had an opportunity to consider one of the trickiest issues in the leasehold-strata area at its May 2015 committee meeting: what happens upon the termination of a strata-lot lease. The committee reviewed how other jurisdictions have dealt with this issue and how other law-reform bodies have proposed to address it and made a tentative recommendation of a model that could be considered for use in British Columbia. This tentative recommendation was communicated to the provincial ministry responsible for housing and the city of Vancouver, both of which are currently grappling with the issue.
Here are some noteworthy numbers for the project in 2015:
- Number of publications: one, the Report on Terminating a Strata (PDF)
- Number of supporting documents issued: 4, a media release on the report (PDF), a backgrounder on the report (PDF), a question-and-answer document on the report’s recommendations (PDF), and a media release welcoming the report’s implementation (PDF)
- Number of BCLI blog posts about the project: 4, including the post you are reading, along with posts on the report, its implementation in Bill 40, and a recent court case of interest
- Number of presentations and articles mentioning the project: 5
- Number of committee meetings held: 11
- Number of tentative recommendations made by the committee: 38
- Number of pageviews for project webpage: 1523
Thanks to our supporters
The Strata Property Law Project—Phase Two has been made possible by support from nine funding organizations. Support from the bulk of these organizations is reviewed from year-to-year. BCLI thanks the following for continuing to support the project in 2015:
- the Real Estate Foundation of British Columbia
- the Notary Foundation of British Columbia
- the Ministry of Natural Gas Development and Responsible for Housing for British Columbia
- the Real Estate Council of British Columbia
- the Real Estate Institute of British Columbia
- the Strata Property Agents of British Columbia
- the Association of British Columbia Land Surveyors
- the Vancouver Island Strata Owners’ Association
- the Condominium Home Owners’ Association