CAT Case Deals with Parking and Compensation

In the recent case of Rahman v. Peel Standard Condominium Corporation No. 779, the owner (Mr. Rahman), claimed a right to use an outdoor handicap parking space because of a disability. The condominium corporation asserted that this was an improper use of visitors’ parking. The condominium corporation also asserted that Mr. Rahman had not provided sufficient evidence to prove his disability.

CAT determined that the space in question was not visitors’ parking and also that Mr. Rahman’s evidence of his disability and need were sufficient. CAT said that PSCC 779 had produced no persuasive evidence to over-ride a letter from Mr. Rahman’s doctor (referring to chronic pain and reduced function due to injuries suffered in a fall from a roof) or to demonstrate that Mr. Rahman’s Accessible Parking Permit was invalid. CAT held that Mr. Rahman was properly entitled to use the particular parking space under the terms of the Declaration.

CAT then turned its attention to the question of compensation.

CAT ordered the condominium corporation to pay $1500 to Mr. Rahman as compensation for an “act of non-compliance” (by the condominium corporation) within the meaning of subparagraph 1.44(1) 3 of the Condominium Act, 1998 (the Act). On this issue, CAT said:

PSCC779 is acting in violation of Article 4.2 of its Declaration in attempting to deny Mr. Rahman access to the accessible parking spaces it provides under Article 4.2(b). PSCC779 is also acting in contravention of Subsection 134(5) of the Act in adding its claim for indemnification, including a claim for legal costs, to Mr. Rahman’s common expenses without a court order.

I think CAT’s comments about the condominium corporation’s indemnification rights (or lack thereof) are particularly important for other Ontario condominium corporations.

PSCC 79 took the position that, based upon indemnification provisions in the condominium’s Declaration, the corporation was entitled to recover all costs incurred by the condominium corporation in its efforts to enforce the parking restrictions against Mr. Rahman. CAT disagreed. CAT said that the condominium corporation had no such rights, for two reasons:

1. CAT said that (as noted in the Amlani decisions) a condominium corporation can’t add enforcement costs to an owner’s common expenses without a Court order under Section 134 of the Condominium Act.
2. Also, there was in any event no violation of the Act, Declaration, By-laws or Rules by Mr. Rahman.

It’s also clear that CAT can award compensation to a condominium corporation under subparagraph 1.44(1) 3 of the Act. [On this point, CAT said: “Given that there has been no violation of PSCC779’s Declaration by Mr. Rahman in this case, it follows that no claim for compensation of PSCC779’s costs, including legal costs, for an attempt to enforce the Declaration may be pursued against Mr. Rahman.”] Based on these words, and also based upon CAT’s new authority to deal with indemnification rights in relation to certain types of disputes (per Section 1 (d) of Regulation 179/17), it certainly appears that CAT can also award compensation that includes enforcement costs (including costs based upon indemnification rights in a condominium’s Declaration, By-laws or Rules) in relation to disputes falling within CAT’s jurisdiction. Hopefully this will be more clearly confirmed in an upcoming CAT decision.

In addition, any such award of compensation (if granted) could be collected by adding that amount to the owner’s common expenses, pursuant to Section 1.45(2) of the Act, which reads as follows:

(2) If an order requires an owner to pay compensation or costs to a corporation, the corporation may add the amount of the order to the contribution to the common expenses payable for the owner’s unit.

So in summary: When it comes to collecting enforcement costs, my key takeaways from the Rahman decision are as follows:

1. In order to recover enforcement costs, CAT says that a condominium corporation needs either (a) a Court order (or an Arbitration award), or (b) a CAT award (hopefully to be more clearly confirmed in a coming decision). [I agree with CAT. In my view, this appears to be the current law in Ontario.]
2. As I’ve previously blogged, in my view this is an unfortunate, impractical result (both for condominium corporations and for non-compliant owners). We all need the province to proclaim in force the pending amendments to Sections 7(4) and 84 of the Act. Those amendments will confirm the rights of condominium corporations to levy common expense chargebacks (for enforcement costs) based upon a suitable indemnification provision in the Declaration, while simultaneously giving owners the right to challenge such chargebacks by “appealing” to CAT.  In my view, that is the practical arrangement that we all need.

I hope the province proclaims the above amendments soon!

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