Strata corporation ordered to pay damages for failure to repair and maintain common property
October 4, 2016
BY Kevin Zakreski
In Hill v The Owners, Strata Plan KAS 510, 2016 BCSC 1753, the BC Supreme Court found that a strata corporation had acted in a significantly unfair manner toward a strata-lot owner. The strata corporation had found itself in a catch-22 when structural defects in the strata-property’s foundation caused warping to the floor of a strata lot’s basement and it could not obtain the approval of its owners to comply with its duty under section 72 of the Strata Property Act to repair common property. The court found the strata corporation liable for $21 000 in damages.
The case involved a 40-unit residential strata property located in Kamloops. The petitioner was a strata-lot owner, represented by her daughter as a litigation guardian.
In 2007, the petitioner notified the strata council of “significant foundation cracking as well as floor slab deficiencies” in the basement of her strata lot. Although the strata corporation had previously “paid for similar repairs to other units in the Complex in a relatively short timeframe,” this time the court found that the strata corporation essentially acted as follows:
The Strata Council investigated the Structural Defects but largely ignored the problem. Initially, this was because they assumed that the Structural Defects did not involve common property over which the Strata Corporation had responsibility. Later, the respondent failed to act because of the significant expenses associated with the required repairs.
Eventually, the strata corporation obtained legal advice, which “confirmed that the Structural Defects were indeed the Strata Corporation’s responsibility to repair.” The strata corporation didn’t act on this advice for several years. During this time, the petitioner’s health deteriorated, and she moved to an assisted-living facility.
The petitioner’s daughter advised the strata corporation of the petitioner’s desire to sell the strata lot and of the need to resolve the foundational defects to make any sale possible. The strata corporation obtained an engineering report and quotes for repairs based on that report. These quotes were put before a general meeting of owners for approval, but they were rejected.
The quotes were rejected again at a subsequent general meeting, at which the owners resolved to pursue “a much cheaper ‘temporary’ repair that was not in accordance with the recommendations” in the engineering report. This plan failed to take off, because “[n]o contractor was prepared to take short cuts in repairing the Structural Defects.”
In the end, after receiving further legal advice, the owners resolved to repair the defects. As the court noted, “[f]rom start to finish, the problem took over 8 years to resolve.” In the meantime, the petitioner launched this court proceeding, claiming unfair treatment contrary to section 164 of the Strata Property Act and seeking “various declarations, reimbursement of costs and expenses incurred as a result of what she says were significantly unfair actions by the respondent.”
The court began its analysis by setting out some general propositions:
Strata councils are made up of lay persons performing volunteer roles. Mistakes will be made and, within reason, some latitude is justified when scrutinizing its conduct: Mitchell v. The Owners, Strata Plan KAS 1202, 2015 BCSC 2153 (CanLII).
The Act sets up a detailed scheme and establishes processes for all aspects of the day-to-day business of a strata corporation. Individual owners need to be able to trust and rely on their strata council to operate within that legislated scheme. There is no room for arrogance in the fulfillment of the volunteer roles of council. There must be recognition that some owners of a strata corporation can become unreasonable and an impossible drain on the patience and time of those who do volunteer: Mitchell, at para 51.
That is, in part, what occurred here.
Nevertheless, the court found “the collective decision of the Strata Corporation was to refuse to comply with its fundamental duty to repair the common area until forced to do so in the fall of 2015.” The petitioner met the test for a remedy under section 164. The court noted that this section includes the “jurisdiction to award ‘damage-like’ pecuniary awards.” The court decided to make such an award:
The damages I intend to award will not involve an arithmetic calculation but rather an assessment of what I view, in light of the unfair treatment the petitioner was subjected to, to be reasonable to compensate Ms. Hill. In my view, the fairest approach is to attempt, as best as the evidence permits, to put Ms. Hill in the same position she would have been in had the Strata Corporation repaired the Structural Defects in a timely manner.
In the result, the petitioner was “entitled to judgement against the respondent in the sum of $21,000” plus costs.