Ontario court examines duty to repair and oppression remedy for strata properties
April 18, 2016
BY Kevin Zakreski
In Ryan v York Condominium Corporation No 340, 2016 ONSC 2470, Mr. Justice Perell of the Ontario Superior Court of Justice examined two pillars of strata-property law: the duty to repair and maintain the property and the remedy for oppressive actions or conduct. The case focussed on sections 89 (repair after damage) and 135 (oppression remedy) of Ontario’s Condominium Act, 1998. British Columbia’s Strata Property Act has equivalent provision in sections 72 (repair of property) and 164 (preventing or remedying unfair acts).
Facts and background
Ryan concerned a “condominium project consisting of 701 residential Units in three highrise buildings with some adjacent townhouse Units,” which was “established in 1977.” Right from the start, the condominium suffered from water-ingress problems:
Not long after the condominium units began to be occupied, it became apparent that there was a serious construction defect. The highrise buildings were defectively constructed because there was no proper building envelope installed for the upper floors. Thus, throughout the history of the condominium, there has been a widespread intermittent water penetration issue largely related to weather conditions. Over the years, various Boards of Directors of YCC 340 have directed temporary fixes in an attempt to rectify the problem, while considering how to bring about a permanent solution.
The applicant was an owner, who purchased his condominium unit in 1980. The respondent was the condominium corporation (which was referred to in the judgment as “YCC 340”).
The case centred on damage to the applicant’s unit from water ingress after a storm in March 2010. After a lengthy series of negotiations, temporary repairs, and further damage, the applicant commenced this proceeding in October 2015, seeking a “declaration that the Respondent . . . has breached its maintenance and repair obligations under the Condominium Act, 1998, and that its conduct has been oppressive to him. [The applicant] seeks, among other things: (a) a mandatory order that YCC 340 restore his Unit to a habitable state; (b) $78,896.63 in special damages; and (c) $150,000 in general damages for mental distress, anxiety and psychological and emotional damages.”
Duty to repair
After noting that “courts apply a test of reasonableness” to determine whether the duty to repair might have been breached, the court discussed the difficulty of applying that test to the facts of this case:
In the immediate case, one difficulty of applying this contextual approach to reasonableness is that if one does a step-by-step analysis, then at any given step the conduct of the condominium corporation and the choices it made between making urgent repairs, temporary repairs, or permanent repairs was arguably reasonable; however, with the benefit of hindsight, i.e., a sort of “the proof of the pudding is in the eating” approach, the conduct of YCC 340 is shown to be unreasonable.
If one examines the whole history and does not approach the facts incrementally, what emerges is that YCC 340 has had a known water penetration problem for over thirty years and has not fixed the problem. This is patently not reasonable. Even if one ignores YCC 340’s state of knowledge acquired before 2010 about the existence of a water penetration problem, the stark fact emerges that Mrs. Bird and Mr. Ryan advised YCC 340 about the water infiltration problem in April 2010 and repeatedly thereafter, but it took YCC 340 until November 2014 (4.5 years) to effect repairs that appear so far to have arrested the water infiltration problem and another year to remediate the presence of mould.
These considerations led the court to conclude that the respondent condominium corporation had breached its duty to repair.
The court provided a helpful general review of the leading Ontario cases and their approach to the oppression remedy. The court began by spelling out the purpose of the remedy: “The oppression remedy in the Condominium Act, 1998 grants the court the jurisdiction to protect condominium owners, corporations, declarants, and mortgagees from unfair treatment.”
Next, the court noted that:
The oppression remedy addresses three kinds of unfair conduct: (1) oppressive conduct; (2) unfairly prejudicial conduct; and (3) conduct that unfairly disregards the interests of the claimant.
Oppressive conduct is coercive, harsh, harmful, or an abuse of power. Unfairly prejudicial conduct is conduct that adversely affects the claimant and treats him or her unfairly or inequitably from others similarly situated. Unfair disregard means to ignore or treat the interests of the complainant as being of no importance.
“The test for oppression,” the court stated, “has two parts: (1) the claimant must demonstrate that there has been a breach of its reasonable expectations; and (2) that, considered in its context, the conduct complained of amounts to ‘oppression,’ ‘unfair prejudice’ or ‘unfair disregard.’ ” In applying this test, court should consider the following “non-exhaustive list of . . . factors”:
(a) the history, the size, structure and nature of the condominium corporation; (b) the type of interest affected; (c) general practice; (d) nature of the relationship between the complainant and the alleged oppressor; (e) the extent to which the impugned acts or conduct were foreseeable; (f) the expectations of the complainant; and (g) the detriment to the interests of the complainant.
In this case, the court concluded that the respondent condominium corporation’s “conduct was ineffective until recently but it was not abusive or oppressive.”
In the result, the court decided to “award Mr. Ryan $69,691.39, plus pre-judgment interest in accordance with the Courts of Justice Act, calculated from the commencement of these proceedings.”