Finding on whether strata plan contained errors in designating limited common property necessary to determine outcome of strata-property parking dispute
19 January 2017
By Kevin Zakreski
In Chow v The Owners, Strata Plan NW 3243, 2017 BCCA 28, the BC Court of Appeal set aside a supreme-court decision and returned a petition to that court for a new hearing. The case involved consideration of whether failure to amend a strata plan under section 257 of the Strata Property Act was significantly unfair (within the meaning of section 164 of the act) to the owners who supported the amendment. In the court’s view, the judge below appeared “to have proceeded on the basis that it was irrelevant whether the strata plan contained an error.” As a result of this approach, the judge didn’t consider whether section 14.12 of the Strata Property Regulation (which deals with the correction of errors in a strata plan) could apply in this case. This led the court of appeal to set aside the judge’s decision and return the case to the supreme court for a new hearing.
Chow concerned “two petitions at the core of which is the common question of the legal status of seven parking spaces in a long-established complex of 37 strata-title townhouses in Richmond.” Each townhouse in the strata property came with a two-car garage. The seven parking spaces at issue had been treated as common property and used as visitor parking. As the court of appeal noted, these assumptions didn’t have a foundation in the strata plan:
Until relatively recently, everyone operated on the assumption that each unit came with two parking spots. It turns out, however, that that assumption may have been wrong. On the strata plan, these parking spaces are not shown as common property. They are described rather as “limited common property.” The strata plan was deposited and registered in the Land Title Office (“LTO”) in May 1990. The effect of describing these lots as “limited common property” is that the owners of the adjacent units can assert the exclusive right to use the space adjacent to that unit. While limited common property is not part of indefeasible title under s. 23(2) of the Land Title Act, R.S.B.C. 1996, c. 250, it is a registered right associated with title constituting a special category of property “over which the unit owner has a substantial degree of control and something approaching a beneficial interest”: see Moure v. The Owners, Strata Plan NW2099, 2003 BCSC 1364 (CanLII) at para. 22.
Once the facts of the strata plan became widely known, two groups within the strata property fell into conflict over the parking spots:
The dissenting owners, identified by the judge as the Chow petitioners, brought a petition claiming exclusive use of the parking spaces, an order preventing the strata corporation from interfering with that use, and ancillary orders, including the cancellation of fines and penalties assessed against them by the strata corporation.
The majority of the owners, identified by the judge as the Co petitioners, brought their own petition, supported by the strata corporation, alleging that the description of the parking spaces in the strata plan was in error and the corporation has acted unfairly in failing to amend it.
The court noted that “[e]fforts to resolve the problem by passing a resolution to amend the strata plan foundered because such an amendment requires unanimous approval, which was not obtained.”
At the hearing of the petitions, the judge received “evidence from a Mr. David Dyck, who is the British Columbia land surveyor who signed the strata plan that was subsequently registered”:
Mr. Dyck deposed that, based on the difference between the strata plan and the original disclosure statement, he now believes that he must have made a drafting error on the strata plan in referring to the seven parking spots as limited common property.
“Although expressing some sympathy for the position the majority found themselves in,” as the court of appeal observed, “the judge dismissed the Co petition and made the orders sought in the Chow petition.” As the court of appeal characterized this decision, the judge “appears to have proceeded on the basis that it was irrelevant whether the strata plan contained an error because the statute as a whole contemplated that the Chow petitioners were entitled to rely on the strata plan as deposited and registered when it came to exercising rights in connection with a resolution under s. 257.”
The court of appeal disagreed with this approach. In its opinion, “the first question that needed to be answered definitively was whether the strata plan contained an error in its description of the parking spots as limited common property. Such a finding is the foundation for the rest of the analysis.”
This step was critical, in the court of appeal’s view, because “[s]ection 257 is not the only means by which errors in the designation of property in a strata plan can be rectified.” Section 14.12 of the regulation should also have been considered in this context. As the court of appeal noted, if the procedure under section 14.12
had been followed here, there may have been no need to resort to a resolution under s. 257. Clearly, s. 257 is not the only way to amend a registered strata plan. Indeed, it may not be the appropriate section under which to proceed, because, as I read the section, it contemplates a procedure for amending a strata plan when there is no issue about the correctness of the plan, but where for other reasons a strata corporation wants to change the designation of property from one status to another. In light of the existence of s. 14.12 in the Regulation, s. 257 is not the only means to amend a registered strata plan and, prima facie, is not the relevant provision for correcting errors.
In the result, the court of appeal allowed “the appeal in the Co petition and set aside the orders below in both petitions” and “reluctantly concluded that this Court is not in a position on the record before us to make the necessary findings to substitute an order disposing of the petitions. Unfortunately, it is necessary to remit the petitions to the Supreme Court for new hearings.”