Spotlight on strata governance: Should the Strata Property Regulation create a new maximum fine for contravention of a short-term accommodation bylaw?

5 June 2018

By Kevin Zakreski

BCLI is running a public consultation on governance issues for stratas. It is asking for public input into its proposed changes to the Strata Property Act, Strata Property Regulation, and Schedule of Standard Bylaws. For information on how to participate in the consultation please visit the Strata Property Law Project—Phase Two webpage.
This post is part of a series that spotlights issues discussed in the Consultation Paper on Governance Issues for Stratas. To read other posts in the series please click here.

Brief description of the issue

Dealing with short-term, hotel-like rentals of residential strata lots has become an emerging concern on the strata-property scene. Commentators agree that the case law on this issue has taken dealing with it outside the scope of a rental-restriction bylaw, so that “a strata corporation that wishes to prohibit hotel-type accommodation should do so by way of a bylaw governing the use of a strata lot, and not by way of a rental limitation bylaw.” Has the time come to bring the maximum fine for contravention of a short-term accommodation bylaw into line with the maximum fine for contravention of a rental-restriction bylaw?

Discussion of options for reform

Although they aren’t addressed by rental-restriction bylaws, short-term rentals raise many of the same concerns that motivate strata corporations to adopt rental-restriction bylaws. These concerns include issues relating to control of property, security, and building character. The similar rationales for these types of bylaws is an argument in favour of harmonizing the maximum fines applicable to them.

Another argument in favour of the proposal is that the current maximum fine might not be providing much of a deterrent to short-term rentals. As advances in communications and technology have made short-term rentals more widespread and lucrative, the penalties for engaging in them haven’t kept pace.

But retaining the status quo is another option to consider. Short-term rentals are a rapidly changing subject, which might be better addressed by some other policy tool. In addition, an argument could be made that short-term-rental bylaws aren’t the equivalent of rental-restriction bylaws. The latter are subject to an elaborate legal framework, which doesn’t apply to a short-term-rental bylaw based on the use of a strata lot.

The committee’s tentative recommendation for reform

In the committee’s view, the time is right to create a new category of maximum fine for contravention of short-term accommodation bylaws. The amount of that maximum fine should be set at the same amount for contravention of a rental-restriction bylaw. To do otherwise would be to risk eroding the deterrent value of bylaws restricting short-term rentals.

The committee tentatively recommends:

The Strata Property Regulation should provide for a new maximum fine to be set at $2000 for each contravention of a short-term accommodation bylaw.

To respond to this tentative recommendation or to read more about issues like this one, please visit the Strata Property Law Project—Phase Two webpage.

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