Canada's Condominium Magazine

Condo Act reforms introduced at Queen’s Park

After a lengthy process that involved numerous public consultation and input from various experts and stakeholders, the government of Ontario has made public its planned changes to the Condominium Act. It’s the first major change to the Act since it was passed in 1998. As the government says, the condo market in Ontario has changed “dramatically” since then. The Consumer Services Minister, David Orazietti, said that the new legislation will help to level the playing field for the average consumer buying a condo.

The proposed legislation will address three key areas: consumer protection for condo buyers; improvements to how condos are run and managed; and means to strengthen the financial sustainability of condo buildings.

These areas will be covered by a new Protecting Condominium Owners Act, which will amend both the existing Condominium Act and the Ontario New Home Warranties Plan Act. A new Condominium Management Services Act will also be enacted.

Faster, cheaper conflict resolution a key issue

One of the most pressing issues to be dealt with is dispute resolution. A new Condominium Authority will make it faster and cheaper for parties to resolve disputes among themselves, rather than having to resort to lengthy and costly litigation.

In the area of consumer protection, the aim is to make condo developers more transparent regarding disclosure statements and other documents pertaining to the purchase of a condo. Buyers will get an “easy-to-read” guide to condo living, as well as clearer rules so that they aren’t “surprised” by unexpected costs.

Financial management rules for condo corporations will also be strengthened to help prevent fraud and mismanagement. Owners will be given more information about their condo corporations’ financial affairs, especially concerning the all-important reserve fund.

There will be some simplifying of the rules for running a condo. It will be easier, for instance, for owners and boards to hold a meeting via conference call or other means. As it stands now, a condo board has to pass a by-law in order to hold a non-conventional meeting.

Condo managers will be regulated

A separate act, the Condominium Management Services Act will regulate condo managers and management firms through a compulsory licensing system. Training and education requirements for managers will be established, and a code of ethics set down. About 2,500 people currently work in condo management in Ontario. There are no qualifications required at present.

The Condominium Authority will be funded by individual owners, who will pay $1 per month. With approximately 700,000 condos in the province today, that will amount to a hefty $8.4 million in the first year alone. Some are skeptical that a new quasi-judicial body with wide-ranging powers and a large budget will not become just another big bureaucracy with big administrative problems. We can only wait and see.

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